The yield on Hungary’s 3-month was practically the same at Tuesday’s auction as a week ago. The Government Debt Management Agency (ÁKK) allotted HUF 30 bn of the instrument. Chances are now smaller that we will see negative yields at the weekly tenders, although we should keep our eyes peeled at the end of the month.
The ÁKK has received HUF 89.5 bn worth of bids from primary dealers on a HUF 30 bn lot of 3-month discount Treasury Bills on Tuesday. This is the strongest demand we have seen in the lsat six months. The average yield was set to 0.14%, one basis point below last week’s average yield. Accepted yields were between 0.12% and 0.14%.
We have been gaining ever great distance from the possibility of negative yields. In late December 2016, accepted yields were occasionally around 0.05%, but we should keep a close eye on these tenders towards the end of the month when the central bank (MNB) will crowed out more liquidity from its main deposit tool and the extra demand might appear on the market.
