This was necessary at the time as it coincided with the period of the high interest rate cycle, and the successful implementation of the auction system in the early stages of a move to market related rates of interest required a shortening of the maturity structure. This resulted in bunching of maturities as well as rendering liquidity management difficult.
In the face of lagging private demand, the government budget served as the main driver of economic activity during 2011. Based on preliminary data, the overall balance of central government operations shifted from near balance in FY2010 to a deficit of $ billion in FY2011 (about 3.6 per cent of GDP).