The Public Treasury has placed on Tuesday a total of 4,969 million euros in Bills at six and twelve months within the expected average range. It has done so by offering the highest returns in both cases, which are above 3.3%. This is clear from the data published by the Bank of Spain and collected by Europa Press.
The improvement in the interest rates offered, in line with the latest increases in interest rates by the ECB, has maintained the investor appetite of the markets for Spanish securities, given that the joint demand for both references has almost doubled what was awarded, with requests of 9,315 million euros.
In addition, this new Treasury issue occurs at a time when individual investors are showing great interest in buying debt, mainly in the short term, given its high profitability, which has been growing since the beginning of 2022, especially in the case of letters in the shortest term.
For Sofía Antón, director of AURIGABONOS, she considers “that interest in Treasury bills will continue to rise in the coming months and ownership between individuals may even reach all-time highs.” The head of the only electronic fixed-income broker for individuals adds that “with the rise in interest rates, Treasury bills have become the star of the sovereign debt market.” In her judgment, it is “the best option” for those individuals who want their savings to have short-term returns.
In this sense, they estimate that with this letter “an investment of 5,000 euros the gross annual return stands at 3.49282% and the net at 3.02% (with expenses included) based on 365”.
six month bills
Specifically, the Treasury has placed 979.31 million euros in six-month bills, compared to a demand of 3,240.41 million euros, and has offered a marginal return of 3.392%, above the 3.143% of the previous issue and reaching its highest level since July 2012.
In the auction of twelve-month bills, the body under the Ministry of Economic Affairs has awarded 3,985.5 million euros, above the requests for 6,075.57 million by investors, and the marginal interest has been placed in the 3.468%, also above the previous 3.247% and reaching its highest level since July 2012. After this auction, the Treasury will return to the markets on June 13 with an auction of 3 and 9-month bills, at the that will follow another on the 15th of State bonds and obligations.
Treasury targets for 2023
The gross issuance by the Public Treasury will be 256,930 million euros this year, which represents an increase of 8.2% compared to the estimate for 2022, due to the rise in interest rates. For its part, the net indebtedness of the Public Treasury in 2023 will remain at 70,000 million. Breaking down by type of instrument, the Treasury Bills are expected to provide net negative financing of 5,000 million, so the State bonds and obligations, together with the rest of the debts in euros and foreign currency, will contribute the remaining 75,000 million.