The Bureau of the Treasury (BTr) has raised P24 billion from its auction of treasury bills yesterday, amid continued strong demand for the government’s short term IOUs.
The auction was more than 5.6 times oversubscribed with total bids reaching P112.1 billion, prompting the auction committee to double the accepted non-competitive bids for the 91- and 182-day securities.
With its decision, the BTr raised a total of P24 billion, exceeding the P20 billion initial offer.
Aside from the inflation outlook, which remains benign, Rosalia de Leon, national treasurer, said that the huge tenders can be attributed to “hefty liquidity and preference for bills.”
“Risk averse with lingering uncertainties on pandemic, (US president Donald) Trump contesting election results and Senate runoff elections in Georgia plus (the) fate of (a) bigger stimulus package,” De Leon told reporters via Viber after the auction when asked why there is preference for treasury bills.
The 91-day paper fetched a rate of 1.024 percent, 3.4 basis points (bps) down from the previous average of 1.058 percent.
Tenders totaled to P33.058 billion, more than six times the P5 billion program, thus the committee opted to raise the awarded amount to P7 billion.
For the 182-day securities, the rate is 1.453 percent, 4.6 bps lower than the previously recorded yield of 1.499 percent.
Demand reached P37.548 billion, more than seven times oversubscribed versus the P5 billion offering, again prompting the auction committee to raise the awarded amount to P7 billion.
Lastly, the yield of the 364-day IOU is 1.745 percent, 1.4 bps down from the previous rate of 1.759 percent.
Tenders amounted to P41.495 billion, with the government awarding P10 billion as programmed.
De Leon said that the BTr also opened the tap facility window for the one-year paper, for another P5 billion. – A. Celis
