So, the NTMA have issued a (welcome) note that Ireland is to resume auctions of T-bills. The note states that “on Thursday 5 July 2012. The NTMA will offer €500 million of Treasury Bills with a three-month maturity in its first such auction since September 2010.”
The details of the auction on 5 July are as follows:
• Auction size: €500 million.
• Maturity: 15 October 2012.
• Auction opens: 9:30 a.m.
• Auction closes: 10:30 a.m.
• Settlement date: 9 July 2012.
This is potentially (pending results of sale, namely yield, volume and percentage allocation to non-captive banks and funds) a minor positive for Ireland. Minor, because
- Bills are NOT bonds – bills are short-term instruments, traditionally under 12 months maturity (bonds are over 1 year maturity).
- Bills issued currently fall to mature within the period of existent EFSF funding programme, so in effect there will always be funds to cover these, short of a catastrophic collapse of the euro during the duration of the bills.
- Issuance of bills has nothing to do in terms of signaling the state of public finances health or economic conditions health of the issuer, as both Greece (see here) and Portugal (here) have issued these during their tenure in the rescue programmes.
- Portugal issuance (linked above
full article at source:http://trueeconomics.blogspot.ie/2012/07/372012-curb-your-enthusiasms.html
Related articles
- Ireland Becomes The First Bailed Out Euro Country To Come Back To The Market (businessinsider.com)
- Republic returns to bonds market (belfasttelegraph.co.uk)
- Finance minister refuses to say why he unilaterally undermined Ireland’s financing position (namawinelake.wordpress.com)
- NTMA returns to international markets today (newstalk.ie)
- Ireland to re-enter bond markets this week (newstalk.ie)
