NTMA looks to raise €750m through sale of treasury bills

The State is seeking to raise up to €750 million through the auction of treasury bills on Thursday, the National Treasury Management Agency (NTMA) said on Monday.

The bills will mature on December 19th. The latest auction will be conducted on the Bloomberg Auction System, and is confined to recognised primary dealers. It will open at 9am and close at 10am.

The NTMA has so far raised €7 billion on behalf of the State this year. This represents a decline of up to 46 per cent on the amount raised last year, with the Government’s Covid-related spending easing this year.

The agency aims to raise €10 billion to €14 billion in international bond markets in 2022. The market interest rate on Irish Government bonds spiked in August as the wider European bond market posted its worst-ever monthly performance.

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While short-dated treasury bills generally see less focus from the market, it comes two weeks after the debt office raised €1.25 billion worth of bonds in the first auction since the European Central Bank began to increase interest rates.

At that auction, on September 1st, the agency sold two bonds at yields of 2.2 per cent to 2.7 per cent, which were notably higher than the last time the debt agency held an auction, in May. That reflected the shift in dynamics in international debt markets since central banks began raising interest rates this year to cool soaring inflation.

Euro-zone inflation accelerated to a fresh all-time high of 9.1 per cent in August from a year ago, fuelled by a 38.3 per cent surge in energy prices, the European Union’s statistics agency Eurostat said in recent weeks.

Bond yields, which rise as their price falls, have been climbing across Europe in recent months, pushing up borrowing costs for governments.