Why is it that Central Bankers always feel the need to talk tough, instead of just quietly getting on with their business. Lars Rohde, the Danish CB governor keeps banging on about what he’s going to do and how much money he can spend, and how negative rates can go, in order to dissuade speculators from buying the Kroner – but they still keep buying it……After all, there are not many AAA Sovereigns left in Europe.
Denmark’s foreign reserves have been rising and now stand at over 30% of it’s GDP, but don’t worry because Rohde says “we can go on for ever” and he also reminds us that “we are the only supplier of Kroner”.
The CEO of the biggest Pension fund in Denmark (ATP) said that they haven’t bothered to hedge their EUR/DKK exposures because “We have full confidence in the Central Bank’s ability to maintain the peg”
Did I mention that Lars Rohde used to be the CEO of the ATP Pension fund……