The Bureau of the Treasury (BTr) has made a full award on the treasury bills auctioned yesterday amid strong market demand and as rates fell across the board.
The auction was oversubscribed with total bids reaching P56.3 billion, nearly thrice the P20 billion offering.
The rates across all tenors fell versus the previous averages.
“It’s expected anyway, (with) the rate cut last week and the news for a further cut mid-year based on (Bangko Sentral ng Pilipinas) governor (Benjamin) Diokno’s pronouncements,” Erwin Sta. Ana, deputy treasurer, said after the auction at the BTr office in Manila yesterday.
“It is reported that the inflation outlook is quite manageable, hence the reduction in the rates,” he added.
The 91-day paper fetched a rate of 3.115 percent, 7.2 basis points (bps) lower than the previous yield of 3.187 percent.
Tenders were more than thrice oversubscribed at P18.405 billion, with a full award at P6 billion.
The rate of the 182-day securities meanwhile was at 3.461 percent, 6.2 bps down from the previous 3.523 percent.
The government awarded P6 billion as programmed, with demand more than twice at P16.82 billion.
Lastly, the 364-day securities fetched an average of 3.908 percent, 5.6 bps lower than the previous rate of 3.964 percent.
Tenders amounted to P21.08 billion, more than twice the P8 billion that was awarded.
Meanwhile, Sta. Ana said the BTr will settle the P310.8-billion three-year retail treasury bond issuance today.
Asked if the government will go for another local jumbo issuance this year, Sta. Ana said:
“We will look at how the disbursements will go, but maybe we’re looking at the second half for another jumbo. It’s too soon to say at this time (the type of issue), it’s more of when we will finance the deficit, so we will have to look into the performance of the disbursements.”
“Now we’ve observed that it’s quite elevated. We will see if that trend will continue on. Of course for the Bureau of Internal Revenue and Bureau of Customs, we’re really looking at it every single day, what they bring in to the table. I guess the optimal timing for a new jumbo will have to be in the third or the fourth quarter,” he added.
As for the dollar bond issuance, Sta. Ana said the government is still monitoring the market.
“The special authority, the Monetary Board, everything’s in place so it’s really on the timing of the transaction and especially also we’ll check our cash buffer, that’s also a consideration,” Sta. Ana said.
