Gov’t upsizes T-bill awards as yields fall
The Marcos administration upsized its Treasury bill (T-bill) awards for the first time in six weeks after yields dropped anew across tenors. This marked a shift from weeks of bid rejections amid heightened volatility from the Middle East war.
Monday auction results showed that the Bureau of the Treasury (BTr) raised P40.7 billion, exceeding the programmed borrowing of P33 billion.
Demand remained strong, with the auction more than 3.9 times oversubscribed, attracting P127.3 billion in total tenders.
The government had been consistently awarding less than planned since March 9, as investors demanded higher yields amid elevated market uncertainty.
Yields had already declined across the board last week, which snapped over a month-long climb, after the announcement of the ceasefire between the United States and Israel.
Still, the BTr partially awarded the 364-day tenor, in contrast to the full awards for the 91-day and 182-day T-bills.
“Treasury bill average auction yields again mostly corrected lower for the second straight week after the net decline in global crude oil prices reached near one-month lows. This led to the sharp decline in local diesel and fuel prices, which could help ease inflationary pressures,” said Michael Ricafort, chief economist at Rizal Commercial Banking Corp.
The decline in yields also comes ahead of the Bangko Sentral ng Pilipinas’ policy meeting on April 23.
Ten of 16 economists polled by the Inquirer expect a quarter percentage-point hike that would bring the benchmark rate to 4.5 percent. If realized, it would be the first rate hike in more than two years.
The 91-day T-bill fetched an average rate of 4.542 percent, down from the 4.7500 percent last week.
The average rate for the 182-day debt paper stood at 4.649 percent, also lower than the 4.882 percent before.
As for the 364-day T-bill, rates averaged at 5.052 percent, down from 5.168 percent in the previous auction.
