The government again failed to attract buyers for its bonds on Wednesday setting a worrisome pattern that has continued for weeks.
The CBI said almost all the past enthusiasts stayed away, namely banks, credit institutions and stock market investors.
Last week barely one bank came forward during the weekly bond auction and bought 15.6 trillion rials ($67 million) in government debt via the central bank’s interbank trade platform.
Bonds on offer were worth 224 trillion rials ($970m). However, despite the latest setback the Central Bank of Iran said the auction will be repeated on June 15.
As per procedures, investors must put in bids for a minimum of 500 bonds each at par value of 1,000 rials via the interbank auction platform managed by the CBI plus the trade platform of Tehran Securities Exchange Technology Management Company.
Last week’s auction was the third of its kind in the current fiscal year that started on March 21. Last year, the government held 42 auctions and earned 1,257.4 trillion rials ($5.4 billion).
The Economy Ministry says the bond policy is tied to the search for funds to meet budgetary needs and is in line with the budget law.
The government opted for the bond policy to plug its deepening budget holes instead of borrowing from the CBI that over the years produced galloping inflation with consumer prices going through the roof.
