Savers interested in investing in Treasury bills will have a new opportunity to do so in the auctions that will take place on the next 11th and 18th of April.
Specifically, Auction of six- and twelve-month Treasury bonds is scheduled for Tuesday, April 11; while On Tuesday, the 18th of the same month, it will be the paper’s turn at 3 and 9 months.
Likewise, investors who prefer to acquire longer-term State debt will have the opportunity to do so at bond and bond auctions scheduled for April 13th and 20th.
Previous bond auctions ended with rising returns
Past short-term debt auctions have yielded very interesting returns for savers, given that Spanish sovereign fixed income is a low-risk asset.
Thus, in the last securities auction, on March 14, the three-month bills were placed at an interest rate of 2.638 percentat levels not seen since July 2012, in the midst of the eurozone sovereign debt crisis.
Likewise, the Treasury placed 1,300 million nine-month bonds at an interest rate of 3.021%, at levels that are very attractive to conservative investors.
The profitability of letters increased in all terms
Something similar happened at the previous auction on Tuesday, March 7th.
At the time, the Treasury placed six- and nine-month bonds that broke the 3% threshold and reached levels not seen since 2008 for these maturities.
Specifically, the six-month bond auction closed at a yield of 3.114%; while the 12-month bonds required a return of 3.295 percent.
It is not yet known what the Treasury’s objectives are for the new auctions which will be held in April, after the end of the Easter holidays.
A thermometer of market sensations
But in the next editions we will see if the market continues to anticipate an even stronger hike in interest rates by the European Central Bank or if, on the contrary, one anticipates a certain relaxation of the ECB’s aggressiveness after the banking crisis that occurred in recent weeks and which swept the Swiss bank Credit Suisse.
And it is that the yield on Treasury bonds has increased in recent months at the pace of the official rates of the ECB. Therefore, if the regulator stops its climb, it could mean a stop in the rally in the profitability of the letters.
Looking at what might happen in the next few months in that regard, it looks like the market is quite divided.
The market is divided over future ECB policy
On the one hand, it seems that the institution chaired by Christine Lagarde remains very determined in the fight against inflation.
On the other hand, the market believes that the ECB will cave if it sees that its harsh policies may continue to wreak havoc on the banking sector.
“If inflation falls rapidly in the coming months and signs of wage growth subside, the ECB may decide to halt any further rate hikes. If inflation holds steady and wage growth accelerates, further increases could follow,” Azad Zangana, senior European economist and strategist at Schroders, recently wrote.