NTMA to hold Treasury bill auction later this week

Tuesday 19 February 2013 12.34
€500m of Treasury bills to be auctioned on Thursday
€500m of Treasury bills to be auctioned on Thursday

The National Treasury Management Agency will hold an auction of Treasury Bills later this week.

The NTMA said it will offer €500 million of Treasury Bills with a three-month maturity similar to the last Treasury Bills auction in January.

That auction saw €500m of three month bills issued at a yield of 0.20%.

Thursday's auction will be the sixth tranche to be sold since the NTMA re-activated the programme last summer.

Danske Bank's Owen Callen said that it now seems increasingly likely that the NTMA will delay its return to the long-term bond markets, when a 10 year syndicated bond is expected to be sold to finally confirm Ireland's return to the market.

''We would then expect the NTMA to begin rolling out regular monthly auctions of long dated bonds, as they prepare to exit the Troika funding programme at the end of this year,'' Mr Callen said.

He said that while there may have been hopes that the NTMA would advantage of the promissory note deal and to immediately issue long term bonds into the market, the country already has a huge cash buffer.

''Reacting too quickly to the deal could also have increased criticisms from those claiming that deal to be akin to "monetary financing", he said.