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Demand healthy but yields inch up at bond auction

Yields inched up at bond auction by the Government Debt Management Agency (AKK) on Thursday, but demand was healthy and AKK raised its offer for the five-year term.

AKK raised its offer for the 2016/C bonds from HUF 15 billion to HUF 20 billion after primary dealers submitted bids of HUF 48.1 billion. Average yield at the auction was 6.76%, just 1 bp over the secondary market benchmark, but 5bp under the yield at the previous auction of the bonds two weeks earlier. Yields were in a narrow range between 6.75% and 6.79%.

AKK sold HUF 20 billion of three-year 2014/C bonds, the announced amount. Offers came to HUF 31.6bn. Average yield was 6.61%, 6bp over the secondary market benchmark and 8bp higher than the yield at the previous auction two weeks earlier. Yields ranged between 6.55% and 6.65%.

AKK sold HUF 10 billion of 15-year 2023/A bonds, also in line with the original offer. Dealers bid for HUF 19.4 billion of the bonds. Average yield was 7.03%, 5bp over the secondary market benchmark, but 6bp under the yield at the previous auction of the bonds on July 29. Yields ranged between 6.99% and 7.07%. (MTI Econews)