Turkish Treasury’s borrowing costs rise in debt auctions.

By bne IntelliNews March 5, 2014

Turkey’s Treasury was forced to pay higher than expected borrowing costs in the debt auctions it held on Tuesday due to international geopolitical concerns and domestic political tension. It borrowed a total of TRY 8.7bn (EUR 2.9bn) on Tuesday, selling 2-year and 10-year fixed-coupon bonds as well as 7-year floating rate notes.

The Treasury sold TRY 1.79bn of the benchmark 2-year paper (re-issue) at a yield of 11.33% versus a market consensus forecast of 11.20%. Non-competitive sales amounted to TRY 1.26bn and demand for the bond stood at TRY 4.9bn. For comparison, the Treasury’s borrowing cots was 11.18% at an auction it held in February for a similar 2-year fixed coupon.

Sales of the 10-year bond (re-issue) stood at TRY 1.62bn at a yield of 10.81%, slightly above the forecast of 10.73%. The Treasury also sold TRY 1.3bn of the paper to primary dealers. Demand for the 10-year bond was TRY 4.46bn.

The Treasury also sold TRY 2.7bn of 7-year floating rate notes at the yield of 9.11% and non-competitive sales amounted to TRY 2.3bn.

Consequently, the Treasury has raised a total of TRY 15.2bn through five auctions it has held this month ahead of its TRY 16.7bn of domestic debt redemption on Wednesday.

Related Articles

Turkey to refuse extradition of all suspects to US unless Washington hands over Gulen says Erdogan

Turkey will not extradite any terror suspects to the US if Washington continues to refuse to hand over Fethullah Gulen, President Recep Tayyip Erdogan said on January 11. Ankara blames the ... more

Turkey rebukes Arab nations for feeble response to Trump’s Jerusalem move ahead of Muslim summit in Istanbul

Turkey has chided what it sees as a feeble Arab reaction to Donald Trump’s decision to reverse decades of US foreign policy by recognising Jerusalem as Israel’s capital. Speaking on December ... more

Russia said to offer Turkey partial financing for S-400 anti-aircraft missile system purchase

Russia is to offer Turkey partial financing for Ankara’s acquisition of S-400 surface-to-air missile systems, Interfax news agency quoted a Russian presidential aide as saying on December 12. ... more