Ministry of Finance’s Treasury Bills Auction on August 18th 2016 Raised LBP 605B
During the week ending August 11, broad Money M3 rose LP 389B ($258M) from August 4 to reach LP 191,133B ($127). 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 the 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 18, 2016, the Ministry of Finance (MoF) raised LBP 605B ($401M), through the issuance of bills maturing in 6M and notes maturing in 36M and 84M. The highest demand was achieved on the 36M notes, which held a 56.43% share of total subscriptions, while the 6M bills and 84M notes accounted for the remaining shares of 7.69% and 35.88%, respectively. The discount rates on the 6M bills stood at 4.87%, while the coupon rate on the 36M and 84M notes registered 6.50% and 7.08%, respectively. New subscriptions exceeded existing maturities by LBP 278B ($184M).
