The government bond issue schedule for February implies low inflation.
Inflation in the first quarter of 2004 is expected to be very low or even negative, implies the government bond issue schedule for February. The Ministry of Finance debt management unit today announced that it would raise NIS 3.5 billion on the local capital market in February.
NIS 2.35 billion, or 67% of the total bond issue, will be raised through unlinked government bonds, including NIS 1.45 billion at fixed interest and NIS 900 million at variable interest. NIS 1.15 billion, or 33% of the total bond issue, will be raised through index-linked bonds.
The Ministry of Finance is continuing its long-term policy not to raise capital through the issue of Gilboa dollar-linked bonds. Issues of Gilboa bonds are liable to cause a shekel appreciation against the dollar, which the ministry wants to avoid. The Bank of Israel also has reservations about raising capital through dollar-linked bonds. The Bank of Israel views such issues as administrative intervention in determining the exchange rate.
The government bond schedule for February will be on three dates: NIS 1.2 billion on February 2; NIS 1.1 billion on February 9; and NIS 1.2 billion on February 16.
Published by Globes [online] - www.globes.co.il - on January 22, 2004