Hungary's Government Debt Management Agency (AKK) plans net forint issues of HUF 269 billion in May-July, with all net issuance in bonds, AKK's fresh three-month forint issue plan revealed.
Bond auction offers will probably rise from recent levels while discount T-bill offers remain unchanged. In contrast with the April-June schedule, published in March, AKK plans to hold reverse auctions in May and June.
Gross issues will come to HUF 1,328 billion and repayments to HUF 1,059 billion during the period.
AKK had planned net repayments of HUF 72 billion for April-June.
The bulk of the HUF 360 billion of planned bond issuance will be net issues, with just one small bond expiry of HUF 835 million of 2016/A bonds on June 30, and HUF 30 billion in early repayments through six reverse auctions tentatively planned for May-July. The previous issue plan for April-June contained no reverse auctions
The longest, 15-year fixed-rate bond is scheduled to be auctioned twice, on April 21 and June 30, during the period. The floating-rate bonds will be offered three times, on April 28, May 26 and July 7. AKK has regularly auctioned floating-rate bonds together with twelve-month bills once a month since last October.
Assuming an unchanged HUF 5 billion per auction offer of floating-rate bonds, the issue plan calculates with about HUF 57 billion of sales per auction at the period's six fixed-rate auctions, held every second Thursday. This may mean a rise in auction offers from the recent HUF 45 billion, but it could also mean AKK adjusted the issue plan for accepted oversubscription and for sales at non-competitive tenders held after auctions.
The HUF 650 billion offer of three-month discount T-bills will just match expiries during the period and translates to an unchanged HUF 50 billion at the weekly auctions. The period will see two big twelve-month discount T-bill expiries, one of HUF 175 billion of the bills on June 1, and the other of HUF 185 billion on July 27. AKK plans net HUF 60 billion of repayments on these bills, with sales of a combined HUF 300 billion at the bi-weekly auctions, that is, keeping the auction offer at the current HUF 50 billion.
AKK plans to sell HUF 18.2 billion of twelve-month interest-bearing T-bills during the period. As usual, the sales target for the bills, designed for retail investors, matches the expiring volume.