Baku Stock Exchange holds auction on placement of CBA's short-term notes

By Trend

The Baku Stock Exchange (BSE) held an auction on the placement of short-term notes of the Central Bank of Azerbaijan (CBA) worth 100 million manat ($58 million) on May 19, 2021, Trend reports citing the BSE.

The circulation period is 28 days.

During the auction, 18 investors filed 28 bills in the price range up to 99.55 manat or $58.55 (5.76 percent).

The maturity date is June 16, 2021.

In accordance with the CBA's decision, the cut-off price of the bonds and the weighted average price amounted to 99.55 manat (5.76 percent).

The total amount of orders at nominal prices made up 738.8 million manat ($434.6 million), and the volume of the placed notes - 100 million manat ($58.8 million), which shows the excess of demand over supply by over seven times.

Starting from 2021, the auctions for the placement of notes of the Central Bank are mainly used to regulate liquidity. The main reason why note auctions are preferable to deposit auctions is the further development of the interbank money market.

Short-term notes are a monetary policy tool for regulating the money supply in circulation. Only banks can buy notes.

(1 USD = 1.7 AZN on May 19)