The Bureau of the Treasury (BTr) fully awarded bids for the treasury bills auctioned on Monday amid strong demand for the short-term IOUs.
The auction was 3.2 times oversubscribed, attracting P80.3 billion in total tenders.
The BTr raised the full program of P25 billion for the Treasury bills offer.
The 91-, 182-, and 364-day securities fetched average rates of 5.546 percent, 5.655 percent, and 5.688 percent, respectively.
In the auction last week, the rates for the 91-day securities remained unchanged, while the rates for 182-day IOUs inched down from 5.675 percent, and the 364-day IOUs from 5.691 percent.
The comparable Bloomberg Valuation Service reference rates are 5.456 percent, 5.609 percent, and 5.736 percent for the three-month, six-month, and one-year tenors, respectively.
Reinielle Matt Erece, economist at Oikonomia Advisory & Research Inc., said investors locked in, as the impact of rate cuts affects yields, especially on shorter tenors.
“In addition, shorter tenors are becoming more attractive as interest rate risks and macroeconomic risks drag down demand for longer tenors due to global uncertainty,” Erece said.
John Paolo Rivera, a senior research fellow at the Philippine Institute for Development Studies, said the significant interest in short-term IOUs is driven by ample liquidity in the financial system, coupled with investor preference for shorter maturities amid continued global uncertainties, including the evolving trade tensions and expectations around interest rate movements.
“Investors are favoring safer, more flexible placements while awaiting clearer signals on medium-term monetary policy trends,” Rivera said.
Michael Ricafort, Rizal Commercial Banking Corp. chief economist, said the latest Treasury bill average auction yields mostly corrected slightly lower, “after local monetary officials reiterated dovish signals amid inflation already below the BSP inflation target range of two to four percent; also after the 10-year Treasury notes offering ended a day earlier on April 23, 2025 and siphoned off about P300 billion from the financial system.”
He said all key indicators—crude prices easing to three-year lows, a strong peso versus the dollar, and waning inflationary pressures—point to possible monetary easing/rate cuts.
