THE NATIONAL TREASURY Management Agency (NTMA) is to hold an auction of €500 million of Treasury Bills later this week.
The auction of the bills with three month maturity is the first of 2013 and is similar to the €500 million offer last November which was four times oversubscribed and saw Ireland’s cost of borrowing fall with a yield of 0.55 per cent.
The bills being auctioned this Thursday will reach their maturity on 22 April and the auction will be another test of Ireland’s ability to return to normal lending markets when it emerges from its bailout.
Subject to market conditions the auction of Thursday’s bills will be followed by two further monthly auctions in the first quarter of this year followed by further announcements on more auctions throughout the year, the NTMA said this morning.
The competitive auction will open at 9.30am this morning and will close at 10.30am. A non-competitive auction will immediately follow and this will close at 4pm on Thursday.
Ireland has been going to the markets on a number of occasions in recent months and the NTMA said last week that it was in talks about selling 10-year bonds to investors, a move which would indicate the likelihood or not of the country of returning to normal lending markets.
The sale of 10-year bonds is considered a key measure of investor confidence in a country.
Borrowing rates for Ireland on these 10-year bonds were at just under 7 per cent when Ireland entered an EU-IMF bailout in November 2010.
Note: This story originally stated that the Treasury Bills auction is taking place today. In fact, the auction is taking place on Thursday.