Dhaka, Bangladesh (BBN) - Auction of treasury bills (T-bills) will not take place during the current month while the auction of government bonds will continue, officials said Sunday.
“The government does not need to borrow through issuing short-term securities in August 2010 as its fund position is good,” a senior official of the Bangladesh Bank (BB), the country’s central bank, told BBN in Dhaka.
The central bank will not hold any auction for T-bills in August, but it would resume from September in line with the existing auction calendar, the BB official added.
The central bank earlier introduced monthly auction calendar of T-bills for the first time aiming to manage the government bank borrowing effectively.
Currently, three T-bills are being transacted through auctions to adjust the government borrowing from the banking system.
The T-bills have 91-day, 182-day and 364-day maturity periods.
On the other hand, four government bonds– 5-year, 10-year, 15-year and 20-year –are being traded in the markets.
Market players, however, said such T-bills auction may create extra pressure on the money market ahead of the Eid-ul-Fitr festival.
The central bank had issued a circular asking all commercial banks and non-banking financial institutions (NBFIs) to follow the new calendar of T-bills auctions for July 2010 and bonds auctions for the first six months of fiscal 2010-2011 (FY11).
BBN/SSR/SI/AD-08Aug10-6:05 pm (BST)
