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Demand for twelve-month bills, floaters healthy, yields rise at auction

Debt

Demand for both twelve-month discount T-bills and fiv-year floating rate bonds rose and the Government Debt Management Agency (AKK) sold the announced volumes at an auction on Thursday. Reflecting continued global uncertainties, yields increased steeply.

AKK sold HUF 50 billion of the T-bills. Offers came to HUF 105.5 billion, well up from an unusually weak HUF 60.2 billion at the previous auction on July 21 when the debt manager cut its sales by HUF 10 billion to HUF 40 billion.

Average yield was 6.04%, 11bp over the secondary market benchmark and up 16bp from the yield at the previous auction of the bills two weeks earlier. Yields ranged between 6.00% and 6.08p.

The twelve-month auction average surpassed 6% for the first time since the middle of January.

AKK sold HUF 7 billion of 2015/B floaters, the announced amount after receiving bids for HUF 19.4 billion. Demand rose from HUF 15.0 billion at the previous auction on July 7.

AKK raised the per-auction offer of floating-rate bonds from HUF 5 billion previously in the light of healthy oversubscription for the bonds, offered four-weekly.

The average net auction price of the floating-rate bonds was 96.74% of nominal value, slightly down from 96.81% on July 7.

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