Kazakhstan
Bonds of the Ministry of Finance of the Republic of Kazakhstan. Last week, the Ministry of Finance of the Republic of Kazakhstan placed two bond issues for a total of KZT20bn (KZT9bn in the previous week). The yield on 7-year government securities did not change, however, compared to the yield on 6-year government securities issued a week earlier, there was an increase by 20 bps. This situation indicates insufficient market efficiency. Bidders took into account the dynamics of the rates of specific issues rather than the upcoming events for similar issues. On the other hand, a large volume of placement of T16bn may imply a certain premium for the volume.
Recently, the Ministry of Finance of the Republic of Kazakhstan has not placed 14-year government securities, however, their yield formed at the level close to the yield of 13-year government securities placed in April (10.58%).
In April, the volume of MF government securities in circulation for the first time since December 2020 showed a decrease of T75 billion. Repayment of medium-term MEOKAM and inflation-linked MEUKAM was faster than of new placements of long-term MEUKAM.
National Bank Notes. The National Bank held one auction for the placement of 28-day notes with a yield of 9% in the amount of KZT550bn. In the period from April 30 to May 6, foreign investors slightly increased the investments in notes from T449bn to T456bn, and the share of the notes held by them increased from 13% to 14.6% due to the reduction of notes in circulation. It should be noted that a change in the volume of individual withdrawal instruments does not at all mean a decrease in the liquidity surplus of the banking system as a whole. For example, the reduction of notes in circulation in the amount of T300-400bn is accompanied by the same increase in the volume of deposits of the National Bank.
