Hunting for increasing returns: 7-year gov’t bonds arouse high interest among investors

The Ministry of Finance held this week the auction for seven-year bonds, which remain among the financial instruments with higher returns for investors.

According to data from the Ministry of Finance, coupon or bonds interest rate resulted at 5.39%, a slight increase from 5.24 % of March.

Even the market of long-term instruments seems to have found a kind of stability after significant fluctuations last year.

The market has a high interest, considering that the returns on investment are quite satisfactory in an environment with low interest rates such as Albania’s financial market.

The auction saw a total demand of ALL 6.5 billion, compared with a value of 4 ALL billion of bonds announced for sale by the Ministry of Finance.

Currently the banking system is highly liquid and remains interested in investments in government securities, despite the weak performance of lending.

The data showed that the Bank of Albania for April credit had a weak performance, with a decline of 0.4% compared with the same period a year ago.

The Albanian government is using this moment to increase the weight of long term instruments in its debt portfolio, taking advantage of current favorable interest rates and reducing the risk of frequent refinancing.

SCAN

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