Borrowing Costs On The Ascent

Croatia's borrowing premium has been on the rise in recent weeks due to central bank measures to support the kuna, which have resulted in rising yields combined with what we view as a mild re-pricing of risk for the Balkan country. At debt auctions on September 27, the Ministry of Finance (MoF) managed to raise HRK151mn (EUR20.1mn) and EUR6.2mn worth of one year treasury bills. While the issuance of kuna-denominated debt was slightly higher than targeted, by HRK1mn, the euro-denominated issuance fell well below the EUR20mn MoF target.

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