Björgólfur Thor Björgólfsson, chairman of the board of investment company Straumur-Burdarás, said during the company’s general meeting yesterday that arbitrageurs are believed to be sitting on ISK 800 billion (USD 11 billion, EUR 7 billion), 75 percent of Iceland’s GDP.
These arbitrageurs trade in price differentials in foreign currency rates between countries, Morgunbladid reports.
Björgólfsson quoted a report from the International Monetary Fund (IMF) published last fall, where IMF predicted the ISK would depreciate by more than 30 percent. In response, Björgólfsson warned that Iceland should expect the ISK to depreciate even further.
According to Fréttabladid, Björgólfsson criticized Iceland’s Central Bank for not having permitted Straumur-Burdarás to convert the company’s stocks into euros, claiming it would have saved shareholders a loss of 20 percent.
Björgólfsson also said the current economic situation in Iceland is preventing development and growth and that it is of great importance that Icelandic authorities do everything they can to create stability and alter their monetary policy to prevent further mistakes. Björgólfsson added he believed the authorities were fully capable of making changes for the better.
“Today’s project, and for the remainder of the year, is to reclaim the credibility of Iceland as an economic system,” Björgólfsson told Morgunbladid.