Interest Rate Curve Analysis: May 2024 Update

As our readers are accustomed, we revisit the interest rate curve movements at least once a month to analyze the most significant developments and adjust our estimates regarding the Central Bank's position. With a benchmark rate of 8% since December 2022, the impact is more than evident on businesses and private consumption in general.

The latest figures relate to the week ending May 10, 2024. Regarding the Treasury yield curve, rates have not budged. They remain at 9.2% for 1-year maturity, 9.9% for 5-year maturity, and 10-year maturity. The recent issuance of BTAs on the primary market (BTA 7.4% February 2030), which raised 24.5 billion, was carried out at a calculated rate of 9.9% based on the curve. The transaction volume within the corridor reached 1,863.2 billion, including 922.4 billion in national bonds. The corridor represents a tolerance range based on minimum and maximum tolerated rates, adjusted according to market movements.

Regarding the corporate leasing rate curve, the ordinary bond yield curve has recorded a slight increase in the short and medium/long term, while the subordinated bond yield curve has remained stable in both the short and medium/long term. The risk premium for ordinary bonds stands at 0.99%, up 1 basis point from the previous week. The subordinated risk premium remains at 0.82%.

We are still at elevated levels, which further postpones the date when the regulator can effectively revise its monetary policy.