Ahead of today's TRY 580mn domestic debt redemption, the Treasury raised TRY 1.5bn from the market by issuing the June 2014 discount bond yesterday at a 5.71% yield. The sale amount was close to expectations, while the average yield settled slightly above the 5.67% consensus. 

The auction did not have any major market impact due to the relatively limited borrowing size. Next week's auctions will be more critical since the agenda will include the new 10-year fixed coupon bond along with the re-issuance of the 2-year benchmark bond and 5-year fixed coupon bond, as well as the initial issue of the 7-year FRN. 

The Treasury will redeem a bulky TRY 11.4bn next week. The Treasury needs to raise TRY 6.4bn from the market and TRY 2.1bn from public institutions next week to meet the March borrowing schedule, which assumes an 87.5% domestic debt roll-over ratio in total and 84.5% for the market only.