The foreign exchange reserves of the Czech National Bank (CNB) increased roughly three and a half times to EUR 124.6 billion while the exchange rate commitment was in place between November 2013 and April 2017. This unprecedented growth has led the CNB to review how the reserves are managed....

A central bank may decide to conduct foreign exchange interventions when it concludes that the exchange rate level without such interventions would be insufficiently strong. A by-product of such interventions will then be a build-up of official foreign exchange (FX) reserves. A case in point is...