Hungary cuts offer of short-term bonds at latest auction, yields rise.

By bne IntelliNews August 9, 2013

The Hungarian state debt manger AKK sold a combined HUF 35bn (EUR 117mn) in three-, five- and 10-year fixed-rate bonds at an auction on August 8, cutting the initial offer by HUF 5bn on weak demand, the agency informed. Investors’ bids totalled HUF 55bn, slightly up from HUF 52.4bn at the previous auction held a couple of weeks ago.

AKK sold HUF 13bn worth of three-year bonds on August 8, down from HUF 18bn initially planned. The issue lured bids of HUF 17.5bn, providing a relatively weak coverage over the supply. Demand eased from HUF 24bn at the previous auction. The average yield at the latest auction reached 4.74%, up by 20bps from the previous tender and 3bpt over the benchmark fixing.

AKK sold the announced volume of HUF 13bn of five-year bonds. Demand dropped further to HUF 17.3bn from HUF 18.6bn at the previous auction. The yield averaged 5.21%, up by 24bps from the previous auction and 3bps over the secondary market benchmark.

The state debt authority placed the announced volume of HUF 9bn in 10-year bonds. Demand rose to HUF 20.2bn from HUF 9.8bn at the previous undersubscribed auction. The average yield stood at 6.16%, up by 26bps from the previous auction and 2bps above the secondary benchmark fixing.

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