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Romania rejects all bids in 300 mln lei (65 mln euro) 2019 T-note auction

Romania rejects all bids in 300 mln lei (65 mln euro) 2019 T-note auction Romania's finance ministry

BUCHAREST (Romania), October 16 (SeeNews) - Romania on Monday rejected all bids in a 300 million lei ($77 million/65 million euro) auction of Treasury notes due on April 29, 2019, central bank data showed.

Demand in the auction stood at 468 million lei. The issue will be reopened on Tuesday when the finance ministry hopes to raise 45 million lei in a non-competitive tender.

At the previous auction of the same T-note issue held in September 2016, the finance ministry sold the planned amount of 500 million lei at a yield of 1.39%.

This is the fourth auction in which the finance ministry has rejected all bids in October. The ministry has said it planned raise 2.44 billion lei in auctions of government paper this month.

On October 12, Romania rejected all bids in a 600 million lei auction of Treasury bills due on October 15, 2018. On October 5 and 9, Romania rejected all bids in two auctions of Treasury notes due on February 25, 2019 and on April 29, 2024, respectively.

Commenting ahead of the Monday auction, Raiffeisen Bank analysts noted that since mid-September, yields on short-term dated Treasury paper, with the maturity of less than 2 years, has leapt sharply by around 85-100 basis points. The rise was mainly driven by a liquidity shortage which emerged in the money market recently, Raiffeisen Bank said in a daily market report.

Details follow:

Auction date October 16 September 2016
Amount offered (mln lei) 300.0 500.0
Amount sold (mln lei) - 500.0
Total bids placed (mln lei) 468.0 2,767.8
Bid-to-cover ratio 1.56 5.53
Yield (%) - 1.39

Romania's finance ministry has said it planned to auction 2.2 billion lei worth of government securities and to sell an additional 240 million lei in non-competitive offers in October.

In September, the ministry auctioned 3.35 billion lei worth of domestic debt paper and an additional 405 million lei in non-competitive offers, slightly below target.

On Wednesday, the finance ministry raised 1 billion euro ($1.17 billion) through the sale of 10-year Eurobonds at a yield of 2.114% amidst solid demand. According to the ministry, with the transaction, Romania closed its 2017 external financing plan of 3 billion euro.

So far this year, the ministry has sold some 37.5 billion lei and 340 million euro worth of government bills and bonds and has tapped foreign markets for 2.75 billion euro of 2027 and 2035 Eurobonds.

In June, the ministry said it plans to sell 7.5 billion euro worth of Eurobonds on the international markets in the following two years.

The ministry said it plans to sell some 48-50 billion lei worth of leu-denominated domestic debt this year.

In June, the ministry said it planned to sell 7.5 billion euro worth of Eurobonds on international markets in 2018 and 2019.

(1 euro=4.5854 lei)

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