Ministry of Finance’s Treasury Bills Auction on August 25th 2016 Raised LBP 334B

During the week ending August 11, broad Money M3 rose LP 389B ($258M) from August 4 to reach LP 191,133B ($127B). As such, M3 recorded a 4.73% annual growth and a 2.43% rise since the start of the year.

Moreover, M1 fell LP 204B ($136M) over the same period to LP 8,945B ($6B). This drop can be attributed to the decrease in money in circulation by LBP 75B ($50M) and in demand deposits by LBP 129B ($86M).

Total deposits (excluding demand deposits) increased by LP 594B ($394M) during the week, as deposits denominated in foreign currencies and deposits denominated in local currency registered respective rises of  $239M and LP 233B.

Over the above mentioned period, the broad money dollarization rate increased from 57.86% on August 4th to 57.93% on August 11th. According to the Central Bank, the overnight interbank fell from 3.25% in May 2016 to 3% in June 2016.

In the Treasury Bills’ auction held on August 25, 2016, the Ministry of Finance (MoF) raised LBP 334B ($222M), 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 45.27% share of total subscriptions, while the 3M and 12M bills accounted for the remaining shares of 15.25% and 39.48%, 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 212B ($141M).

 

 

 

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