T-bill yields mixed as 91-day tenor swamped

MANILA, Philippines — The Bureau of the Treasury (BTr) yesterday made a full award of the 91-day Treasury bills (T-bills), but partially made awards of the 182-day and 364-day securities amid higher rates asked by investors.

During yesterday’s auction, the BTr decided to fully award P4 billion worth of P91-day T-bills, as the rates fetched by the securities averaged 3.291 percent, 1.7 basis points lower than the previous rate of 3.308 percent.

The securities were more than three times oversubscribed, with total tenders reaching P13.528 billion.

On the other hand, only P3.424 billion worth of 182-day T-bills were sold yesterday after the auction committee decided to cap the accepted rates at 4.2 percent. This was below the P5 billion original issue size.

As a result, the rates fetched by the 182-day T-bills stood at 4.185 percent, 14 basis points up from last week’s 4.095 percent.

The auction was slightly oversubscribed with total bids amounting to P8.086 billion.

Likewise, the BTr successfully sold only P4.677 billion worth of 364-day T-bills after the accepted rates were capped.

The one-year debt notes fetched an average rate of 4.767 percent, 9.7 basis points higher than the 4.67 percent recorded last week.

Total bids reached P6.587 billion, slightly above the P6 billion original issue volume.

According to National Treasurer Rosalia De Leon, the results of the auction continue to reflect the market’s preference for shorter dated securities due to concerns on inflation and interest rate hikes.

“It’s nothing that we don’t expect coming again from the persistent concerns on inflation and expectations that the BSP (Bangko Sentral ng Pilipinas) will again hike this August,” De Leon told reporters after the auction.

“There would also be the likelihood that the Fed (US Federal Reserve) will also have a rate hike, so all these are the persistent concerns of the market, so they are already putting some buffer in terms of the rates to make sure they will be covered,” she said.