The issuance of Treasury bills has experienced an increase in profitability this Tuesday, up to 3.7% in its shortest term, three months, at a time of recovered demand among individuals for public debt, especially more in the long term.
The Treasury has placed 2,035 million euros in three- and nine-month bills, of which 440 million correspond to the first type and 1,595 million to the second. With these issues, it advances on its planned schedule for the whole year, of which it has already resolved almost 24% of the financing requirements.
The most relevant thing about today’s auction has been the interest on the three-month debt, almost two tenths higher than those registered in the previous placement, 3.53%. It is again the highest interest rate in at least a decade, despite the downward trend in recent months, which began with messages from the European Central Bank (ECB) that there would be no more rate increases.
The nine-month bills have instead been placed at 3.5%, at a rate very similar to the 3.49% in last month’s auction. Typically, three-month bills give less profitability than nine- and twelve-month bills, and if that circumstance is not occurring it is because the market predicts that there will be interest rate cuts in the medium term.
If in three months the demand has been 2,210 million euros, in nine months it has stood at 4,050 million, which exceeds 6,200 million euros, three times more than the amount of emissions.
Also noteworthy is the rise in interest among individuals in nine-month bills, amounting to 1,013 million euros, almost half of the total requests. After three months, it was 235 million euros, a much lower figure, as is usually the case in short-term issues.
In nine-month bills, the demand from individuals, for more than 1,000 million euros, has broken all records for this product. Not only has it far exceeded 356 million euros, but also the levels of around 600 million euros when, at the beginning of 2023, letters became the star product for many small investors.
The Treasury’s forecast, led by Paula Conthe replacing Carlos Corpo, was to raise between 1,500 and 2,000 million euros, which has once again left it in the middle part of the range.
