The Treasury will close November issues this week, with households as the largest holders of bills

MADRID, 12 Nov.

The Treasury will close November issues this week, with households as the largest holders of bills


The Public Treasury will close the auctions for the month of November this coming week, with an issuance of 3- and 9-month bills and another of State bonds and obligations, according to the calendar published by the body dependent on the Ministry of Economic Affairs and Digital Transformation.

These auctions occur at a time when individual investors continue to show great interest in purchasing debt, mainly in the short term, given its high profitability, which has been growing since the beginning of 2022.

In fact, households and private non-profit institutions serving households have gone from having 35 million euros in Treasury bills in August 2022 to 20,348 million in August 2023, becoming the largest holders of this type. short-term debt, according to the latest data published by the Bank of Spain.

The high profitability of short-term securities has had a very considerable effect on the distribution of Treasury bill holdings, where households and non-financial institutions have notably increased their participation in the last year, going from a share of 0, 04% in August 2022 to 28.7% in August 2023.

Thus, it is expected that in the next issue on Tuesday, of 3 and 9 month bills, households will show interest in purchasing debt. In the last issue of this type, the Treasury placed 2,037 million, raising the remuneration for both references.

Specifically, the interest offered on 3-month bills stood at 3.590%, its highest level since November 2011, while that on 9-month bills stood at 3.818%, the highest percentage recorded. taking into account that this reference was launched in February 2013.

The auction will be marked by the recent decision of the European Central Bank (ECB) to leave interest rates intact after ten consecutive increases. In addition, the United States Federal Reserve (Fed) has also chosen to maintain rates, in its case for the second consecutive time.

For its part, the Treasury plans to auction references on Thursday in an auction that will close the issues for the month. Specifically, it plans to auction 3-year State bonds, with a coupon of 2.80%; 10-year State obligations, with a 3.55% coupon and 20-year State obligations, with a 3.45% coupon.

The previous yields for these references were placed at 3.533% for 3-year State bonds; at 4.074% for 10-year State obligations and at 4.007% for 20-year State obligations.

The gross issuance by the Public Treasury will be 256,930 million euros this year, which represents an increase of 8.2% compared to what is estimated for 2022, due to the rise in interest rates.

Regarding net issuance, the Government has announced that it will be reduced by 5,000 million euros by 2023 thanks to the "good performance" of the Spanish economy and the "loose" compliance with fiscal objectives. With this, Spain will go from a net debt issue of 70,000 million to 65,000 million euros.