The Bureau of the Treasury (BTr) fully awarded bids for the Treasury bills at auction yesterday, as the short-term IOUs continued to see brisk demand from investors.
The auction was 2.6 times oversubscribed, and attracted P56.3 billion in total tenders, the BTr said.
The bureau raised the full program of P22 billion.
The 91-, 182-, and 364-day securities fetched average rates of 5.318 percent, 5.662 percent and 5.78 percent, respectively.
The rates across all tenors were higher than the previous and secondary market rates.
The previous rates were 5.128 percent for the three-month tenor, 5.562 percent for the six-month tenor, and 5.726 percent for the one-year tenor.
In comparison, the Bloomberg Valuation (BVAL) Service rates were 5.158 percent, 5.564 percent, and 5.743 percent for the respective securities.
“The Bangko Sentral ng Pilipinas’ (BSP) decision to keep (policy) rates steady, and inflation risk remains… (causing) rates (to go) up,” Jonathan Ravelas, senior adviser at professional service firm Reyes Tacandong & Co., said via Viber.
Earlier, the policy-setting Monetary Board decided to keep the Target Reverse Repurchase Rate at 5.75 percent steady, the BSP said citing economic uncertainty and other global trade risks.
Interest rates on overnight deposit and lending facilities will also stay at 5.25 percent and 6.25 percent, the BSP said.
Michael Ricafort, Rizal Commercial Banking Corp. chief economist, said that Treasury bill average auction yields corrected slightly higher for the second straight week after the unexpected pause in the key local policy rate during the latest BSP rate-setting meeting on February 13.
“Treasury bill average auction yields also corrected slightly higher after some increased market demand/interest for long-term local government securities (as an alternative investment to short-term local government securities), which mostly corrected lower recently after lower US Treasury yields recently,” Ricafort said.
“For instance, the 10-year PHP BVAL yield eased to among 1.5-month lows at 6.13 percent (lower/better from the immediate high of 6.33 percent posted on January 17, 2025), after the benchmark 10-year US Treasury yield recently eased to near two-month lows at 4.48 percent (lower/better from the immediate high of 4.81 percent posted on January 14, 2025), after the Trump Administration signaled that lowering the 10-year US Treasury yield would be a policy priority, instead of questioning the Fed rate decisions,” he added.
