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Liquidity T-bill auction undersubscribed

Hungary's Government Debt Management Agency (AKK) sold HUF 30 billion six-week "liquidity" T-bills, HUF 20 billion less than announced at an undersubscribed auction on Monday.

Yields rose from the previous six-week bill auction held one month earlier.

AKK sold HUF 30 billion of the bills expiring on May 23, less than the announced HUF 50 billion. Primary dealers bid for just HUF 38.0 billion, about half of the HUF 79.0 billion bids submitted the previous liquidity auction on March 5.

Average yield was 7.22%, 11bp over the yield at the previous auction of liquidity bills four weeks earlier. The range of accepted yields moved between 7.13% and 7.26% as against the range of 6.99% and 7.18% on March 5.

The closest, three-month secondary market benchmark yield, calculated on a bill series expiring on August 22, was 7.35% on Friday.

AKK auctions these shortest-term bills on a case by case basis, depending on the liquidity requirements of the central government.