Partial award of T-bill rates rise across the board

MANILA, Philippines — The government only made a partial award of P12 billion in short-dated Treasury bills (T-bills) as investors demanded higher yields across the board.

Results were mixed during yesterday’s T-bills auction as the Bureau of the Treasury made a partial award of P12 billion out of the P15 billion on offer.

This effectively ended three straight weeks of full award for T-bills on offer P5 billion each for three, six, and 12 months.

Yields for 91-day T-bills inched up 1.7 basis points to 2.07 percent, a significant jump from last week’s rate of 1.874 percent.

This prompted the Treasury to only award P4.3 billion out of the P5 billion on offer.

Similarly, only P2.721 billion was raised for the 364-day T-bills, which averaged at 3.782 percent, also rising by 1.7 basis points. Yields for the one-year tenor also increased week-on-week.

The Treasury only made a full award of P5 billion for the 182-day short-dated debt papers even as rates picked up by 27.6 basis points to 3.336 percent.

“Rates rose following the recent 50-basis-point hike in policy rate,” national treasurer Rosalia de Leon said.

Last week, the central bank delivered another 50-basis-point rate hike as inflation remains stubbornly high at 6.4 percent in July.

This brought the benchmark rate to 3.75 percent from the current 3.25 percent.

Rates also rose ahead of the first Retail Treasury bonds (RTBs) sale of the Marcos administration today.

Overall, demand for the short-term securities dropped by 24 percent week-on-week.

Total bids reached P30.756 billion, oversubscribing the auction by two times, but still lower than last week’s P40.532 billion.

By tenor, bids for the three-month, six-month and full-year securities all went down, totaling to P8.27 billion, P15.265 billion and P7.221 billion, respectively.

The Treasury has so far raised P57 billion out of its target P75 billion in short-dated T-bills this month.