Ministry of Finance (MoF) Raised LBP 241B through its Auction on the 3rd of November

During the week ending October 27, Broad Money M3 fell by a weekly LP 127B ($85M) to reach LP 193,267B ($128B). As such, M3 recorded a 5.04% annual increase and a 3.57% rise since the start of the year.

Moreover, M1 progressed by LP 104B ($69M) over the same period to LP 8,983B ($6B). This fall can be attributed to the LBP 198B ($131M) rise in demand deposits and the LBP 94B ($62M) drop in money in circulation.

Total deposits (excluding demand deposits) narrowed by LP 231B ($153M) during the week, as deposits denominated in foreign currencies and term and saving deposits denominated in local currency registered respective falls of  $30M and LP 187B.

Over the above mentioned period, the broad money dollarization rate slightly rose from 58.22% on October 20th to 58.23% on October 27th. According to the Central Bank, the overnight interbank rate remained stable at 3% between July and August 2016.

In the Treasury Bills’ auction held on November 3, 2016, the Ministry of Finance (MoF) raised LBP 241B ($160M), through the issuance of bills maturing in 3M and 12M and notes maturing in 60M. The highest demand was achieved on the 60M notes, which held a 48.91% share of total subscriptions, while the 3M and 12M bills accounted for the remaining shares of 22.84% and 28.25%, respectively. The discount rates on the 3M and 12M bills stood at 4.39% and 5.08%, respectively, and the coupon rates on the 60M notes recorded 6.74%. New subscriptions exceeded existing maturities by LBP 110B ($73M).

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