Yields offered on one-year accounts are slightly down | From this Tuesday it is necessary to make an appointment to buy bills from the Bank of Spain
The hunger for Spanish debt seems completely insatiable. The Treasury placed another 5,062 million euros in a short-term debt auction (six- and 12-month bills) on Tuesday, with demand once again far exceeding expectations. In concrete terms, investors asked for a total of 10,190 million euros, more than double what was ultimately awarded by the State.
At a time when small savers are showing a growing interest in this asset class, the Treasury raised 1,062 million in its six-month accounts, compared to a demand of 2,327 million. The yield offered (measured by the marginal interest rate, that of the highest accepted offer) was 2.69%, more than the 2.59% of the previous issue of the same maturity. It is the highest level since July 2012, in the middle of the sovereign debt crisis and with the risk premium skyrocketing.
In one-year bills, the Treasury placed 4,000 million euros, compared to the 7,863 million that investors had requested. In this case, profitability fell to 2.83% from 2.99% in January. It is a one-year interest rate that no other type of financial product currently offers with almost no risk.
The gluttony that individuals have shown for bills in recent times has today found its maximum expression in long queues outside the doors of the Bank of Spain, where they flocked to ask to participate in the issues.
Demand has grown so much that the Treasury Department website, where these titles can also be purchased, collapsed on several occasions last week, forcing the agency under the Economy Ministry to beef up its customer service to deal with the avalanche of requests. to be able to handle.
As Carlos Cuerpo, Secretary General of the Treasury, explained a few days ago, it was only in January that the 900 million euros of private individuals were exceeded. A figure that multiplies by almost five times the usual monthly average.
Just yesterday, the institution raised the figure so far this year to 1,100 million eros. Faced with this authentic fervor, the Bank of Spain has also been forced since Tuesday to require a prior appointment from individuals wishing to use its Direct Accounts service, from which they can access this market.
This new gold rush for Treasury bills comes in the thick of the battle of interest rate hikes by the European Central Bank (ECB) and banks’ refusal to transfer these hikes to their customers’ deposits. Specifically, the remuneration of savings on deposits of households with a term of 12 months is barely more than 0.4%, seven times less than what is now stated in the letters. And current accounts remain at 0.032%. That is, practically nothing.
“The outlook for the fixed income market has improved significantly compared to last year. In particular, the Spanish government debt segment offers an attractive investment opportunity for conservative profiles; and with this type of asset you can get an interesting return, assuming a low risk”, they indicate from Mutuactivos.
The manager has just launched a new fund that will invest at least 80% of its portfolio in government bonds, mainly Spanish, with maturities of less than three years. “The inflow of money into our fixed income funds has accelerated since last summer, but since December it has been insane,” agreed another national manager.
The expectation of rapid growth in this type of investment among retailers is echoed by other companies and banks, which also generate higher commission income through the sale of funds.
Source: La Verdad
I’m Ben Stock, a journalist and author at Today Times Live. I specialize in economic news and have been working in the news industry for over five years. My experience spans from local journalism to international business reporting. In my career I’ve had the opportunity to interview some of the world’s leading economists and financial experts, giving me an insight into global trends that is unique among journalists.
