Baku, Azerbaijan, May 22
By Fakrhi Vakilov- Trend:
Following the results of electronic trading in the initial placement of one-year Government securities (GS) at the Uzbek Currency Exchange, the weighted average yield of one-year GS amounted to 10.47 percent (the price of the bond amounted to 104.1 percent of its nominal value) by updating the benchmark at the level of 12.94 percent - 14.94 percent in February-March, Trend reports with reference to Ministry of Finance of Uzbekistan.
In addition, according to the results of the auctions held on May 8 and 15, the number of active bids for the purchase of one-year GS at the end of auctions was 5 times higher than their offer. In particular, the total number of active applications for the purchase of state securities in the amount of 100 billion soums was 504 billion soums on May 8 and 479 billion soums on May 15.
Increased demand for government securities and a significant decrease in the benchmark indicates their relevance in financial markets.
The relevance impacted by strengthening confidence of financial market participants in government securities as a reliable and liquid instrument for investing with minimal risk.
Another reason for the demand for GS is the introduction of an automated system with remote electronic trading, which contributed to the formation of a real competitive environment and the strengthening of market mechanisms for determining the value of GS.
Diversification of terms and volumes of government securities is designed to attract new participants to financial markets and form a yield curve (benchmark) of government securities, which will reflect macroeconomic expectations and risk assessments in the medium and long term.
Furthermore, the interest shown by international investors in the purchase of state securities in national currency indicates the presence of significant untapped growth potential of this financial market segment.
($1-8434.55 soums on May 22)
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