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Demand revives, yields drop at three-month T-bill auction

Oversubscription for a reduced volume on offer was almost fivefold and the average yield dropped at an auction of discount three-month T-bills by the Government Debt Management Agency (ÁKK) on Tuesday.

Yields dropped after rises at the previous two auctions although they still varied in a wide range.

ÁKK sold HUF 30bn of the bills due on January 11, 2012, the announced amount, despite almost five-fold oversubscription. The debt manager reduced the announced volume from HUF 50bn at the previous auction on September 20 and from an unusually high HUF 60bn two weeks earlier, offering three-month bills expiring in 2012 for the first time.

Primary dealers submitted offers for HUF 145.2bn as against HUF 101.8bn at the previous auction.

Average yield at the auction was 5.91%, 4bp under the secondary market benchmark and 3bp lower than the yield at the previous auction of the bills one week earlier. Yields ranged between 5.78% and 5.95%.