TIRANA, August 2 – The secondary market of government securities was dominated by transactions in short-term instruments (T-Bills) at 94.24 percent and long-term instruments (notes and bonds) at 5.76 percent during the first half of this year. The Financial Supervisory Authority says that in terms of the number of transactions, 98.73 percent of all transactions in the secondary market of government securities were in T-Bills. Participation in the Government securities secondary market was dominated by individual investors, who performed about 97.38% of all transactions in the market.
T-bill yields unchanged
Treasury-bill yields remained at 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 remained at 7.69 percent in the latest action held on August 2, up from 7.65 percent in the previous auctions.
Three-month T-bills also slightly remained unchanged at 5.74 percent in the latest auction.
Albania’s central bank auctioned 9.3 billion lek (225 mln Euro) in 12-month and 3-month 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).
