Ministry of Finance (MoF) Raises LBP 253B through its April 27th Auction
During the week ending April 20th, Broad Money M3 rose by a weekly LBP 398B ($263.8M) to reach LBP 202,985B ($134.65B). Moreover, M3 recorded a 7.8% annual increase and a 1.98% rise since the start of the year.
M1 fell by LBP 222B ($147.5M) over the same period to LBP 9,146B ($6.07B). The fall is mainly attributed to the decreases in currency in circulation by LBP 133B ($88.23M) and in demand deposits by LBP 89B ($59.04M).
Total deposits (excluding demand deposits) increased by LBP 620B ($411.35M) during the week, as term and savings deposits denominated in local currency decreased by LBP 10B ($6.63M), while deposits denominated in foreign currencies increased by $418M.
Over the above mentioned period, the broad money dollarization rate rose from 59.42% on April 13th to 59.62% on April 20th. According to the Central Bank, the overnight interbank rate remained stable at 3% between December 2016 and March 2017.
In the Treasury Bills auction held on April 27th, 2017, the Ministry of Finance (MoF) raised LBP 253B ($168M), through the issuance of bills maturing in 6 months (6M) and notes maturing in 3 years (3Y) and 7 years (7Y). The highest demand was achieved on 3Y notes, which accounted for 49.72% of total subscriptions, while the 6M bills and 7Y notes accounted for the remaining shares of 10.65% and 39.63%, respectively. The discount rate on the 6M bills stood at 4.87%. Whereas the coupon rates on the 3Y and 7Y notes stood at 6.5% and 7.08%, respectively. Existing maturities exceeded new subscriptions by LBP 70B ($46M).
