Ministry of Finance’s T-bills Auction on July 28th 2016 Raised LBP 354.96B

During the week ending July 21st, broad Money M3 dropped by LP 113B ($74.96M) from July 14 to reach LP 190,210B ($126.18B) on July 21. As such, M3 recorded a 4.54% annual growth and a 1.94% rise since the start of the year.

Moreover, M1 shrank by LP 287B ($190.26M) over the same period. This decrease can be attributed to the fall in money in circulation by LBP 128B ($84.91M) and in demand deposits by LBP 159B ($105.47M).

Total deposits (excluding demand deposits) increased by LP 174.30B ($115.62M) during the week, as deposits denominated in foreign currencies registered a $123M rise, while deposits denominated in the local currency decreased by LBP 11B.

Over the above mentioned period, the broad money dollarization rate slightly increased from 57.87% on July 14th to 58.00% on July 21st. According to the Central Bank, the overnight interbank rose from 3% in April 2016 to 3.25% in May 2016.

In the TBs auction held on July 28th, 2016, the Ministry of Finance (MoF) raised LBP 354.96B ($235.46M), through the issuance of bills maturing in 3M and 12M and notes maturing in 60M. The highest demand was achieved on the 12M bills, which held a 45.19% share of total subscriptions, while the 3M bills and 60M notes accounted for the remaining shares of 14.33% and 40.48%, respectively. The discount rates on the 3M bills and 12M bills stood at 4.39% and 5.08%, respectively, while the coupon rate on the 60M notes registered 6.74%. New subscriptions exceeded existing maturities by LBP 14.81B ($9.82M).


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