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ÁKK misses auction target on poor demand

Hungary’s  government debt management agency ÁKK sold HUF 40 billion of twelve-month T-bills at an auction on Thursday, HUF 10 billion less than the announced amount as demand fell to its lowest level in one year.

The ÁKK sold HUF 40 billion of the discount T-bills expiring on June 27, 2012, cutting its sales from the announced HUF 50 billion amount. Bids came at HUF 60.2 billion, well down from HUF 107.7 billion at the previous auction on July 7 and the lowest volume since the HUF 57.5 billion subscription for the same HUF 50 billion offer on June 24, 2010.

The last time ÁKK cut its 12-month bill auction sales was in December 2010.

Oversubscription of the bills started to drop late June after rising to move between HUF 148 billion and HUF 203 billion in the previous two months.

Average yield was 5.88%, 3bp over the secondary market benchmark, calculated on the same bill series, and level with the average yield at a July 7 auction. Yields ranged between 5.85% and 5.90%.