Ministry of Finance (MoF) Raised LBP 743B through its Auction on the 31st of August

During the week of 25 to 31 August 2017, Broad Money M3 increased by a weekly LBP 441B ($293M) to reach LBP 208,765B ($138.48B). In addition, M3 recorded growth rates of 8.07% on a year-on-year basis and 4.89% since the start of the year.

Over the same period, M1 went up by LBP 519B ($344M) to LBP 10,102B ($6.70B). This increase is mainly due to a LBP 341B ($226M) rise in currency in circulation and an LBP 178B ($118M) uptick in demand deposits.

Total deposits (excluding demand deposits) fell by LBP 78B ($51M) over the same period, as term and savings deposits denominated in local currency rose by LBP 120B ($80M) during the week, and deposits denominated in foreign currencies dropped by $131M.

The Broad Money dollarization rate dropped from 60.23% on the 24th of august to 60.01% on August 31 2017. According to the Central Bank, the overnight interbank rate remained stable at 3% between December 2016 and May 2017.

In the Treasury Bills auction held on Aug. 31, 2017, The Ministry of Finance (MoF) raised LBP 743B ($493M), through the issuance of bills maturing in 6 months (6M), in addition to notes maturing in 24M and 120M. The highest demand was achieved on the 120M notes, which grasped a 47.18% stake of total subscriptions, while the 6M bills and 24M notes accounted for the remaining shares of 12.44% and 40.38%, respectively. The discount rate on the 6M bills was 4.87%, while the coupon rates on the 24M and 120M notes stood at 5.84% and 7.46%, respectively. New subscriptions lagged behind existing maturities by LBP 131B ($ 87M).


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