Oct., 10th auction provided the state budget with almost UAH21bn, which was equally divided between borrowings in local and hard currency.
Demand for 12-month bills fell to UAH2bn. However, the Ministry of Finance rejected one bid for UAH710m with a rate of 17.6%, keeping the cut-off rate at 17.55%, and reduced the weighted average rate by 1bp to 17.54%.
For military bills maturing in June 2025, the Ministry accepted all bids, but not in full, as demand was greater than supply. Non-competitive bids and competitive bids with rates below the maximum are satisfied in full, while bids at the maximum rate were partially satisfied within the cap and in proportion to the size of the bid.
Demand for new three-year notes significantly exceeded supply, so both non-competitive and competitive demand were satisfied by the "residual" method. The MoF used UAH1.5bn of bonds (30% of the cap) to satisfy non-competitive bids in proportion to their size. Competitive bids with rates lower than 19.19% were accepted in full, and competitive bids at 19.19% in proportion to the size of the bid within the cap. The MoF rejected six bids at 19.2%.
Demand for USD-denominated bills was greater than supply. The Ministry accepted all 111 applications, although some of them partially. The cut-off rate did not change, 4.8%, and the weighted average decreased by 1bp to 4.78%.
The total amount of funds raised for the budget was the largest in almost four months, mainly due to a higher premium for the tenor compared with NBU CDs, as well as the desire of investors to reinvest FX funds from last week's redemption in new instruments. At the same time, auction participants are in no hurry to compete and mainly they submitted bids with maximum rates or close to them.
