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Denmark's central bank stepped into the foreign exchange market in June for the first time in more than six years to support the Danish krone after the currency weakened to its lowest level against the euro in over 25 years.
According to data released by Danmarks Nationalbank on Thursday, the central bank sold a net 0.7 billion Danish kroner (around $110 million) in June through foreign exchange market operations. The move was aimed at strengthening the krone and maintaining its long-standing fixed exchange rate policy against the euro. It marked the first such intervention since March 2020.
Under Denmark's exchange rate framework, Danmarks Nationalbank is responsible for keeping the krone closely aligned with the euro. The intervention came as pressure on the currency increased, prompting the central bank to act in defense of the peg.
Despite the market intervention, Denmark's foreign exchange reserves rose by 11.8 billion kroner during June, reaching 699.3 billion kroner. The increase reflected the central bank's net purchase of 0.8 billion kroner worth of foreign currency, combined with 11.0 billion kroner in net foreign borrowing by the Danish government.
The central bank also confirmed that its key interest rates have remained unchanged since June 12, 2026. The discount rate, current account rate, and certificate of deposit rate continue to stand at 1.85%, while the lending rate remains at 2%.
Meanwhile, the combined net position of Danish banks and mortgage-credit institutions with Danmarks Nationalbank declined by 1.0 billion kroner in June, leaving an outstanding balance of 301.1 billion kroner.
The Danish government's net financing requirement totaled 0.8 billion kroner during the month, underscoring stable public financing conditions even as the central bank moved to stabilize the currency market. The latest intervention highlights Denmark's continued commitment to preserving the krone's peg to the euro and maintaining confidence in its monetary policy framework.
