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Hungary debt manager keeps auction volumes unchanged May-July HUF issue plan

Telco

Hungary's Government Debt Management Agency (ÁKK) plans net forint securities issues of HUF 79 billion in May-July 2013. With no change in bond or discount T-bill auction offers, the new three-month issue plan gives no hint of support for a plan to increase forint financing. ÁKK deputy László András Borbély said last week that ÁKK could finance a part of FX government expiries through forint bond issues, supporting the MNB's recently announced plan to reduce the country's short-term external debt by HUF 1,000 billion. National Economy Minister Mihály Varga said earlier in the week that he supported an increase in the share of forint financing, although both officials noted that any such move would depend on market conditions. The net forint issues planned for May-July are HUF 120 billion less than those planned for April-June. The drop is the result of unchanged issues and more short-term expiries. Raised offers by ÁKK on high demand at recent discount T-bill auctions have pushed up expiries. Net bond issues will rise to HUF 304 billion from HUF 244 billion in April-June as early buybacks are scaled down to HUF 60 billion from HUF 120 billion in the previous three months. There are no big bond expiries in either period. Net discount T-bill repayments are scheduled to rise to HUF 235 billion from HUF 50 billion in the previous three months. Retail T-bill purchases are assumed to exceed maturities again by HUF 10 billion. Gross issues in the three months will drop HUF 50 billion from the previous three-month period to HUF 1,466 billion, and gross repayments will rise HUF 293 billion to HUF 1,496 billion in May-July, according to the plan. Gross bond issues are expected to total HUF 395 billion at the seven fixed-rate bond auctions and the three auctions for floating-rate bonds, the same as in April-June, implying unchanged offers at each of the auctions.

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