Romania’s Treasury forced to rely on costly short-term financing

Romania’s Treasury forced to rely on costly short-term financing
By bne IntelliNews February 13, 2018

Romania’s Treasury issued bills on February 12 for the first time since last September, when short-term interest rates began to rise. The Treasury issued RON400mn worth of bills with a maturity of 12 months. 

Four issues with the same maturity have been canceled since September, as banks’ expectations were seen by the government as too high. But between the widening budget deficit and rising interest rates, the Treasury is under increasing pressure to raise funds.

After longer-term debt became expensive as well (the yield for the April 2024 bonds rose to 4.35% this February from 4.05% in December), the Treasury agreed to pay a 2.42% yield for the one-year papers (versus 0.79% in August) at the February 12 auction.

In related news, the cost of money kept increasing, rising by 2bp since the end of last week with the six-month quotations marginally up to 1.87%/2.36% on February 12. The quotations for 12-month funds also increased slightly to 1.97%/2.46%.

The Treasury also tapped the local market on February 12 by re-opening a long-term bond maturing in September 2031 (163 months residual maturity) and rising RON100mn at 4.75% yield (versus 4.12% last June). The Treasury is also considering issuing euro-denominated bonds (€200mn) as an alternative to the increasingly costly local debt, Ziarul Financiar daily reported.

Read in IntelliNews Pro
Get IntelliNews Pro

Related Articles

APS, EBRD buy €400mn sub-performing Romanian loans from Piraeus

The European Bank for Reconstruction and Development (EBRD) announced that alongside debt recovery specialist APS it is taking over a ... more

Annual inflation Uzbekistan edges up to 8.1% in April from 8.0% in March

Inflation in Uzbekistan was in April recorded at  0.93% m/m and 8.08% y/y, according to the national ... more

Uzbekistan's 4M24 budget deficit hits $2bn, sparking fiscal concerns

The state budget deficit of Uzbekistan, amounting to Uzbekistani som (UZS) 25.6 trillion ($2.0bn) in the first four months of 2024, has surpassed expectations, raising concerns about the country's ... more

Follow Us On

Most Read

  1. Shocking trial of ex-minister has shifted domestic violence attitudes in Kazakhstan, says brother
    6 days ago
  2. RAGOZIN: Exhausting Russia, strategies and fantasies
    5 days ago
  3. Live fish fall from the sky in Central Iran - video
    3 days ago
  4. Russia is producing weapons at a record pace, and Ukraine’s partners are trying to increase support for Kyiv
    7 days ago
  5. COMMENT: Aliyev continues to block the chance of peace in the South Caucasus
    9 days ago
  1. Albanians campaign on social media to keep bus bridge created in freak accident
    2 years ago
  2. Saudi Arabia to scale back plans for Neom city
    28 days ago
  3. Iran vs Israel: Who is better equipped for war?
    25 days ago
  4. Leading emerging markets move rapidly up World Bank’s PPP GDP and FDI confidence rankings
    29 days ago
  5. Ukraine's birth rate plummets to 300-year low as country’s population collapses
    21 days ago

Reports

Dismiss