You recall that at the time that the BOM announced that it was going to raise Rs60 bn on the market to finance the similar grant to Govt, we had said that is a masquerade. We had commented that under pressure from the Press, the Opposition’s requests for clarification, negative public comments, and probably also on account of IMF reservations expressed informally, BoM has been compelled to present a face-saving device. But the BoM grant to Govt will remain a printing money measure.
See the latest attempt, dated 9th July, by Government to raise Rs 3.5 billion by issuing 5-year Bank of Mauritius Bonds ; they were not able to raise a single rupee. Please note that the interest rate received was 1.95 % whereas the Key Repo Rate (KRR) is at 1.85 %.
As you see, It was just an attempt to pull the wool over the public’s eyes.
