Tbill yields continue to rise

TIRANA, July 18 – Treasury-bill yields reached their highest level for this year in the latest auction as government demand to finance the budget deficit rises. Bank of Albania data show 12-month T-bill yields rose to 7.69 percent in the latest action held on July 12, up from 7.65 percent in the previous auction.
Six-month T-bills also slightly rose to 6.82 percent, up from 6.8 percent in the latest auction.
Albania’s central bank auctioned 31.5 bln Leks (225 mln Euros) in six-month and one-year T-bills in the latest auction.
Rising government need to finance the budget deficit is making investment in T-bills more profitable than deposits. A recent report published by the Bank of Albania shows interest rates for 12-month deposits dropped by 0.08 percent to 5.8 percent in March 2011.
The Bank of Albania organizes 3-month and 6-month T-bill auctions every month and 12-Month T-Bill auctions every two weeks. T-bills are issued and guaranteed by the Ministry of Finance on behalf of the Albanian government. T-bills are traded in the primary and secondary market. The minimum amount to participate in the primary T-bills market is 300,000 lek (3,000 U.S. dollars).