T-bill rates down across the board

MANILA, Philippines — Rates for the government’s short-term securities dropped across the board as they tracked secondary market movements after inflation picked up anew.

The Treasury yesterday made a full award of P15 billion, marking the fourth straight week of full award.

Rates yesterday declined for the 91, 182, and 364-day offers in comparison with the reference rates. However, yields on a weekly basis were mixed.

Rates tracked the secondary markets after headline inflation jumped to 5.3 percent in August from 4.7 percent in July, snapping six months of downtrend.

Inflation picked up anew amid more expensive food items following the recent typhoons, as well as higher transport costs due to oil price hikes.

Meanwhile, rates for the 91-day T-bills went down by eight basis points to 5.575 percent from the secondary rate of 5.655 percent, but was higher from last week’s 5.552 percent.

The 182-day short-dated debt papers saw rates inch down by 2.7 basis points to 5.96 percent and below last week’s level of 5.966 percent.

On the other hand, rates averaged 6.19 percent for the 364-day T-bills, 0.3 basis points lower than the secondary rate and also down from last week’s auction rate of 6.198 percent.

The entire P5 billion each was awarded for the three tenors.

Further, overall demand for the short-term securities increased by 8.9 percent to P51.814 billion. The auction was oversubscribed by 3.45 times.

Bids went up across the board to P14.715 billion, P15.983 billion, and P21.116 billion for the three, six, and 12 month securities, respectively.

For this month, the Treasury targets to raise P180 billion from the domestic debt market.

Of this, P60 billion is expected to be borrowed from T-bills. It has so far raised half of the target at P30 billion.