February 5, 2019 / 2:50 PM / 6 months ago

Russia may scrap limit for OFZ government bond offering

MOSCOW, Feb 5 (Reuters) - Russia’s finance ministry said on Tuesday it was considering scrapping its usual practice of setting a maximum amount of OFZ treasury bonds on offer next week.

The ministry, which usually offers OFZ bonds at weekly auctions every Wednesday, said it could be more flexible in its reaction to changes in market conditions and fulfil more bids if it stops setting the ceiling.

If it scraps the limit, the amount of OFZ bonds it sells will be determined by overall demand as well as the premium that investors ask for compared with the bonds’ actual yields, the ministry said.

The ministry, which borrows money for the budget by selling OFZ bonds, said it would inform markets on its decision regarding the auction mechanism on Feb. 12.

This week, the ministry is offering 35 billion roubles ($534 million) of OFZ bonds at two auctions on Wednesday.

$1 = 65.5200 roubles Reporting by Andrey Ostroukh; Editing by Mark Potter

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