T-bill rates down this week due to strong demand

The Bureau of the Treasury (BTr) offered it for PHP6 billion but tenders were more than five times at PHP32.576 billion. The auction committee made a full award for the three-month paper.(Photo:Bureau of Treasury/Facebook)

MANILA — Strong demand for the Philippines Treasury bills (T-bills) resulted in the drop of the debt papers’ average rate Monday.

Rate of the benchmark 91-day T-bill fell to 2.032 percent from 2.088 percent during the auction last September 11. Secondary market rate for the same tenor on Monday morning stood at 2.9161 percent.

The Bureau of the Treasury (BTr) offered it for PHP6 billion but tenders were more than five times at PHP32.576 billion. The auction committee made a full award for the three-month paper.

Rate of the six-month paper averaged at 2.522 percent, lower than the 2.564 percent it fetched last September 11. Secondary market rate for this tenor is 2.7817 percent.

Tenders reached PHP20.416 billion, more than four times the PHP5 billion offering. The auction committee also made a full award for this tenor.

Average rate of the one-year paper declined to 2.861 percent from 2.920 percent in the previous auction. Secondary market rate on Monday’s morning session stood at 3.1339 percent.

BTr offered the debt paper for PHP4 billion and awarded at that level even as bids reached PHP15.31 billion.

Deputy Treasurer Erwin Sta. Ana told reporters after the auction that demand for the debt instruments was strong and this resulted in “a very good turnout for today’s auction”, especially for the shortest tenor.

He attributed the strong demand for the benchmark paper partly to the Bangko Sentral ng Pilipinas’ (BSP) statement last week that inflation remains manageable, the Federal Reserve statements’ of programmed normalization in its balance sheet and the geopolitical concerns overseas.

“Maybe, participants are really keen on going on the short end,” he added.