Ministry of Finance (MoF) Raises LBP 778B through its March 16th Auction
During the week ending March 9, Broad Money M3 increased by a weekly LBP 24B ($16M) to reach LBP 201,482B ($134B). Moreover, M3 recorded a 7.97% annual increase and a 1.23% rise since the start of the year.
M1 dropped by LBP 208B ($138M) over the same period to LBP 9,273B ($6.15B). The fall is mainly attributed to the respective decreased of LBP 14B ($9M) and LBP 194 ($129M) in money in circulation and in demand deposits.
Total deposits (excluding demand deposits) rose by LBP 232B ($154M) during the week, as term and savings deposits denominated in local currency rose by LBP 127B ($84M) and deposits denominated in foreign currencies grew by $70M.
Over the above mentioned period, the broad money dollarization rate slightly dropped from 59.11% to stand at 59.16% on March 9. According to the Central Bank, the overnight interbank rate remained stable at 3% between December 2016 and January 2017.
In the Treasury Bills auction held on March 16, 2017, the Ministry of Finance (MoF) raised LBP 778B ($516M), through the issuance of bills maturing in 6 months (6M) and 24M and notes maturing in 60M. The highest demand was achieved on the 24M notes, which held a 51.47% share of total subscriptions, while the 6M and 60M bills accounted for the remaining shares of 9.97% and 38.56%, respectively. The discount rate on the 6M bills stood at 4.87% while the coupon rate on the 24M and 60M notes registered 5.84% and 7.46% respectively. Existing maturities exceeded new subscriptions by LBP 57B ($38M).
