Ministry of Finance (MoF) Raises LBP 291B through its July 27th Auction
During the week of 14 to 20 July 2017, Broad Money M3 increased by a weekly of LBP 1,194B ($792M) to reach LBP 207,856B ($137.88B). In addition, M3 recorded a growth rate of 8.96% on a year-on-year basis a 4.83% increase since the start of the year.
M1 increased by LBP 310B ($206M) over the same period to LBP 10,037B ($6.66B). This rise is mainly due to a LBP450B ($300M) increase in currency in circulation and LBP140B ($93M) drop in demand deposits.
Total deposits (excluding demand deposits) increased by LBP 884B ($556M) over the same period, as term and savings deposits denominated in local currency increased by LBP 316B ($210M) during the week, and deposits denominated in foreign currencies went up by $376M.
The Broad Money dollarization rate dropped from 59.931% on July 13th to 59.860% on July 20th. 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 July 27, 2017, the Ministry of Finance (MoF) raised LBP 291B ($193M), through the issuance of bills maturing in 3 months (3M) and 12 months (12M) and notes maturing in 60M. The highest demand was achieved on the 60M notes, which held a 44.84% share of total subscriptions, while the 3M and the 12M bills accounted for the remaining shares of 24.35% and 30.81%, respectively. The discount rate on the 3M and 12M bills stood at 4.39% and 5.08%, while the coupon rates on the 60M notes registered 6.74%. New subscriptions exceeded existing maturities by LBP 34B ($23M).
