Large demand for six-week T-bills at auction

Debt

Demand was unusually large for the HUF 40bn six-week "liquidity" T-bills on offer and sold by the Government Debt Management Agency (AKK) at an auction on Monday. Yields were well below the closest, three-month secondary market benchmark.

AKK sold the announced HUF 40bn of the bills expiring on February 22 after receiving bids for HUF 148.5bn.

The average yield came to 7.77% at the auction, sharply down from the closest, three-month secondary market benchmark, of 8.41%, calculated on a series expiring on May 2, on Friday.

Yields varied between 7.55% and 7.88%.

The auction was the first one since Fitch downgraded Hungary to non-investment status, with a negative outlook, on Friday. The move followed similar steps by Moody’s at the end of November and by Standard and Poor’s late December.

AKK last auctioned liquidity T-bills on November 28, 2011 when it sold HUF 35bn against an only slightly oversubscribed HUF 50bn offer at an average yield of 7.24%. That auction came after Hungary’s downgrade by Moody’s, and the average yield rose 61bp from the previous liquidity bill auction held one week earlier.

ADVERTISEMENT

Varga puts 2021 GDP growth at 7-7.5% Analysis

Varga puts 2021 GDP growth at 7-7.5%

Opposition parties to begin PM candidate primaries Elections

Opposition parties to begin PM candidate primaries

New managing director at the helm of Wolt Hungary Appointments

New managing director at the helm of Wolt Hungary

Budapest bike-sharing scheme boasts record ridership City

Budapest bike-sharing scheme boasts record ridership

SUPPORT THE BUDAPEST BUSINESS JOURNAL

Producing journalism that is worthy of the name is a costly business. For 27 years, the publishers, editors and reporters of the Budapest Business Journal have striven to bring you business news that works, information that you can trust, that is factual, accurate and presented without fear or favor.
Newspaper organizations across the globe have struggled to find a business model that allows them to continue to excel, without compromising their ability to perform. Most recently, some have experimented with the idea of involving their most important stakeholders, their readers.
We would like to offer that same opportunity to our readers. We would like to invite you to help us deliver the quality business journalism you require. Hit our Support the BBJ button and you can choose the how much and how often you send us your contributions.