Macro and Politics

* The Treasury tapped the domestic markets to the tune of TL71.2bn (including non-competitive sales) via yesterday’s 5m G-bond auction, while also sold TL7.3bn at the direct sale of 2y lease certificate. The bid – to – cover ratio was robust at 2.52x, while the average cost of borrowing was 43.21% for 5m G-bond auction. Accordingly, the Treasury’s total domestic borrowing so far this month has reached TL131.8bn. Following this week’s auctions and direct sale, the Treasury will hold 4y TLREF-indexed bond auction on February 17^th and 3y CPI-indexed & 5y fixed coupon bond auctions on February 18^th and finalize its domestic borrowing program for February. According to three-month (Fed – Apr 25) domestic borrowing strategy, the Treasury has a total domestic redemption of TL117.8bn in February, while in return plans to borrow TL180.1bn throughout the month, via five auctions and one direct sale.