The decrease of the interest rate at low record levels in September has not affected in the Treasury bond market. In the latest auction, treasury bonds issued by Bank of Albania at an interest rate of 3.31%, similar to the interest rate of treasury bonds sold in October.
The same thing happened to 6-month maturity bonds, which were quoted at an average interest rate of 3.16%. Although the lowering of the interest rate on deposits did not caused fluctuation in the Treasury bond market, their interest rate is lower compared to the same period of a year before.
Treasury bond market, according to economy experts, is being stabilized after the slight correction of interest rate on deposits by Bank of Albania. Stabilization of interest appears result of a more restrained application of the banking system for securities that year had invested surplus liquidity in these instruments.
Economy experts say that the interest rate is expected to increase during 2015 as the lending has started improving, since many fiscal policies have been applied by the Central Bank in the second period of 2014 and will continue to be in effect even in 2015. This means that the banking system has less redundancy liquidity, while further improving the country’s private activity will increase demand for financing from banks.
News source: Scan Tv
Photo credits: AwoiSoAk /Wikimedia
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