Increased activity in Lebanon’s bond market
At the November 9th auction, a pick up in purchasing activity was witnessed as investors started coming off the sidelines, feeling more comfortable with a settled new government.
Purchase subscriptions of TBs rose by 12.3 percent to LP438.12 billion ($290.62 million), while maturing bills fell 15.1 percent to LP273.57 billion ($181.47 million). The increased demand at the official auction resulted in the already limited secondary market trades dwindling further.
The healthier appetite for TBs was reflected in investors ’bias towards the 24-month maturity, the share of which out of total subscriptions increased to 58.2 percent from 44.8 percent. The 12-M-TB’s share declined 4.5 percentage points to 22 percent, while that of the shorter-term 6-M and 3-M TBs lost 9 points to 19.8 percent.
Sales of Banque du Liban certificates of deposit were a little more lively than of late, with LP10 billion ($6.63 million) worth sold. The 45-day CD attracted most attention, as LP7 billion ($4.64 million) were sold, while LP3 billion ($1.99 million) in sales of 60-day CDs were also registered.
The 45 and 60- day CDs are not matched by similarly termed TBs, as investors look to deploy their excess Lebanese pound funds in local currency instruments of various maturities. — ( Banque du Liban et d'Outre-Mer Sal )
© 2000 Mena Report (www.menareport.com)