Press Release 50925: LEBAC Bill Auction Press Release
The BCRA put up LEBAC bills in pesos for Dutch auction today.1
The BCRA offered LEBAC bills for a maximum amount of ARS150 billion (nominal value), an invitation to non-bank participants (both residents and non-residents). Bids amounted to ARS214.235 billion (nominal value), and ARS150 billion (nominal value) were awarded. The cut-off yield stood at 45% for both 28 and for 63 and 91 days.
With LEBAC maturities for ARS381.93 billion (nominal value), including holdings of financial institutions for ARS92.21 billion (nominal value), today’s issue releases ARS231.93 billion (nominal value), to be absorbed in the next two days, as follows: new issue of Treasury Bills for a maximum amount of ARS150 billion (nominal value), new issue of LELIQs for financial institutions, for up to ARS100 billion, and 5-point increase in reserve requirements as from tomorrow, accounting for around ARS150 billion (both directly and due to bank re-intermediation), plus additional absorption of ARS20 billion for sale of reserves and settlement of temporary advances today. The BCRA thus confirms the projection of a contraction in market liquidity of around ARS100 billion.
The strong demand for LEBACs observed in today’s auction is expected to be channeled to tomorrow’s bill auction, thus confirming that the persistent containment of liquidity in pesos encourages demand for these assets and ensures increasing stability in the foreign exchange market.
1. The call for tender was announced through Communication B 11,749 dated September 14, 2018, as under the provisions of Communication B 7621 dated December 2, 2002, Communication B 11,210 dated February 1, 2016, Communication B 5974 dated May 16, 2016, and Communication A 6548 dated August 13, 2018; the auction was carried out through the SIOPEL system on Mercado Abierto Electrónico (MAE).
