MoF Raised $108.31M in the Treasury Bills’ Auction Held on February 21st 2019

In the week ending February 21st 2019, Broad Money (M3) fell by a weekly LBP 7B ($5M) to stand at LBP 209,149B ($138.74B), declining 0.30% year-on-year (y-o-y) and 1.41% since the start of the year.

In details, M1 contracted by LBP 156B ($103M) over the same week, to settle at LBP 9,663B ($6.41B). The decrease is attributed to the decline in currency in circulation by LBP 158B ($104M) while demand in deposits rose by LBP 2B ($1.33M).

Over the week, total deposits (excluding demand deposits) grew by LBP 149.10B ($98.84M). This rise was driven by the increase in deposits denominated in foreign currencies and term and saving deposits denominated in LBP by $24M and LBP 113B ($74M), respectively.

As such, the rate of broad money dollarization marginally increased to 64.46% in the week ending Feb. 21st 2019, from 64.44% in the week ending Feb. 14th 2019. In its turn, the average weekly interbank rate stood at 7% in the week of Feb. 21st 2019 down from 9% compared to the previous week.

In the treasury bills (T-Bills) auction held on February 21st 2019, the Ministry of Finance raised LBP 163.28B ($108.31M) through the issuance of bills maturing in 3 months (3M), as well as notes maturing in 1 Year (1Y) and in 5 years (5Y). The highest demand was achieved on bills maturing in 5Y, grasping a share of 93.85% of total subscriptions. Meanwhile, the 3M and 1Y bills accounted for the remaining stakes of 1.85% and 4.30%, respectively. The discount rates on the 3M and 1(Y) bills stood at 5.23% and 6.10%, respectively while the coupon rate on the notes maturing in 5Y stood at 8%.

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