The bank brought treasuries from 15 lenders and will sell them back December 3. Demand stood at RON26.5 billion, down from a record high of RON30.19 billion a week earlier. Last Monday, the bank lent RON6 billion to 17 commercial lenders at an annual interest rate of 5.25%, equal to the monetary policy rate.
Fund allocations are made on a pro-rata basis when auctions are capped so that banks may have asked for higher amounts to make sure they cover their needs.
The bank started limiting its weekly repos in early October, in a bid to increase interest rates in the market and help strengthen the leu.
Central bank Mugur Isarescu said recently that controlling the leu’s evolution through limited repos was more efficient than tightening the monetary policy rate.
On the downside, however, the reduced liquidity makes it more difficult for the finance ministry to borrow at low yields. The ministry plans to sell RON400 million of three and two-year treasury bonds later Monday.
In the money market, weekly rates were at 5.4%-5.9% a year, little changed on the day. (EUR1=RON4.5313)