T-bills fully awarded as yields move sideways

THE GOVERNMENT made a full award of the Treasury bills (T-bills) it auctioned off on Monday as rates moved sideways amid steady demand from the market.

The Bureau of the Treasury (BTr) raised P15 billion as planned via the T-bills it auctioned off on Monday as total tenders reached P53.75 billion, more than three times the initial offer.

However, Monday’s bids were slightly lower than the P59.77 billion seen last week.

Broken down, the Treasury bureau raised P5 billion as planned via the 91-day securities from P14.73 billion in bids. The three-month debt papers fetched an average rate of 0.71%, up 1.9 basis points (bps) from the 0.691% seen last week.

The BTr also borrowed P5 billion as planned from the 182-day securities it offered on Monday from P21.46 billion in tenders. The average rate of the six-month T-bills slipped by 0.1 bp to 1.022% from 1.023% previously.

Lastly, the government made a full P5-billion award of the 364-day debt papers as bids reached P17.56 billion. The average yield on the one-year instrument stood at 1.408%, the same rate seen last week.

At the secondary market prior to the auction on Monday, the 91- 182- and 364-day T-bills were quoted at 0.7497%, 1.1249%, and 1.4394%, respectively, based on the PHP Bloomberg Valuation Reference Rates published on the Philippine Dealing System’s website.

National Treasurer Rosalia V. de Leon said in a Viber message to reporters that demand for Monday’s T-bill offer was strong as P20 billion in maturities boosted liquidity in the system.

Meanwhile, a bond trader said in a phone interview that rates moved sideways due to a lack of catalysts.

Factors that could move yields, such as inflation data released last week, had already been priced in by the market, the trader added.

Inflation slowed to 3% in January, the fifth straight month of deceleration, as housing and utilities prices eased, preliminary data from the Philippine Statistics Authority showed.

This was slower than both the 3.2% in December and the 3.7% in January last year.

The BTr plans to raise P200 billion from the domestic market this month, or P60 billion via T-bills and P140 billion from Treasury bonds.

The government borrows from local and external sources to help fund a budget deficit capped at 7.7% of gross domestic product this year. — J.P. Ibañez