It was the third time this month when the ministry failed to raise any money. Banks offered RON513.8 million at today’s tender, but the ministry wasn’t satisfied with the yield level.
At the latest similar auction July 12, the ministry sold RON400 million of four-year paper at an average yield of 6.41% a year.
Romania sold debt at increasingly lower yields in the first months of 2012, but the trend reversed as the central bank halted a monetary easing cycle, citing uncertainties on external markets and political developments at home.
In addition, traders said lenders are less inclined to buy government paper after the central bank’s decision to cap the amount offered at its weekly repurchasing operations has reduced liquidity in the market and has driven interest rates higher.
Romania sold RON1.4 billion in debt this month, below its initial target of RON2.5 billion. In July, the country sold paper worth RON1.5 billion.
So far in 2012, Romania sold RON38.93 billion in leu-denominated state notes and $2.25 billion in US dollar-denominated bonds. (EUR1=RON4.487)