The Treasury faces the last annual auction of bills and one of bonds and obligations

The Spanish Public Treasury faces the final stretch of the year and this week it will hold two new auctions of the four that are planned for the month of December.

According to the calendar established by the Treasury, next Tuesday, December 5, the last auction of six- and twelve-month bills will be held, and on Thursday, December 7, another bid for bonds and obligations.

On December 12, investors will be offered 3- and 9-month bills, and on the 14th, the last 2023 bonds and obligations.

Last meeting of the ECB

This latest bid will coincide with the monetary policy meeting of the European Central Bank (ECB), an event in which most analysts expect the institution to keep interest rates unchanged.

Last October, the ECB decided to pause rate hikes, the first since July 2021, following the reduction in inflation.

The market expects the ECB to keep rates unchanged again after preliminary inflation data was released this week in some European countries such as Spain and Germany, which were better than expected. In addition, eurozone inflation data for November was published on Thursday, which fell to 2.4%. 3.35%

However, the profitability offered by Treasury Bills has reached highs in the last year, driven by this monetary tightening by the ECB. In the auction carried out by the Public Treasury on November 14, the average interest on 3-month bills stood at 3.552% and that on 9-month securities at 3.686%. The previous week, 6-month Letters were bid on with an interest of 3.709% and 12-month Letters with 3.606%.

What are treasury bills?

Treasury Bills are short-term fixed income securities issued by the Public Treasury. These are debt securities for 3, 6, 9 and 12 months with very little risk of the Government taking to the market to obtain financing. Each of these Letters has a nominal import of 1,000 euros and this would be the minimum investment amount, although it can be increased by investing multiples. As it is a fixed income, profitability is guaranteed and, therefore, the buyer has the profits that he will obtain at the expiration of the insured term.