Demand high, yields above benchmark at three-month T-bill auction

Debt

The Government Debt Management Agency (AKK) sold HUF 5bn more three-month discount T-bills than planned at an auction seeing threefold subscription on Tuesday. Yields fell sharply from a week earlier but exceeded Monday’s respective benchmark.

AKK sold HUF 50bn of the bills, HUF 5bn more than the announced amount as demand for the bills expiring on May 9 totalled HUF 136.7bn.

Demand jumped back after dropping to HUF 89.5bn at the previous auction on January 24. With that exception, demand for the bills has been well over HUF 100bn throughout January.

Average yield was 7.41%, 6bp over the secondary market benchmark, calculated on a bill series expiring on May 2, and 24bp under the yield at the previous auction of the bills one week earlier.

Yields ranged between 7.20% and 7.45%, as the range dropped and narrowed further from between 7.45% and 7.73% at the previous auction.

The debt manager will hold an exchange auction offering HUF 5bn-5bn of 2023/A bonds in exchange of 2013/D and 2013/E bonds on Wednesday. AKK refused all the combined HUF 13bn bids at the last such auction on January 4 in an apparent dissatisfaction of the prices in the bids.

AKK will auction HUF 45bn of twelve-month discount T-bills expiring on December 27 on Thursday.

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