1-year facility for IOUs opened

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    The Bureau of the Treasury (BTr) made a full award on the treasury bills auctioned yesterday and opened the tap facility for the one-year IOUs amid healthy market demand.

    The auction committee sold P20 billion as programmed, with tenders for all tenors more than twice oversubscribed at P40.388 billion, over half of which is accounted for by the 364-day securities.

    “We had a full award for all tenors and we’re going to open the tap for the one-year given the strong demand for the one-year paper,” Rosalia de Leon, national treasurer, said after the auction at the BTr office in Manila.

    The rates for the 91-day and 182-day papers rose while it fell for the 364-day instrument.

    When asked about the increase in rates in the shorter tenors, de Leon said: “It’s going to increase in terms of the inflation path for next year.”

    “It’s not really significant in terms of the bids but we still see a very healthy submission in terms of the volume given that we have the RRR cut starting December, and we had a huge maturity in November, so those coupled together, we see that there would be more liquidity unleashed into the system,” she added.

    The 91-day paper fetched a rate of 3.192 percent, 2.4 basis points (bps) higher than the previous average of 3.168 percent.

    Tenders amounted to P10.46 billion, with a full award of P8 billion.

    For the 182-day treasury bills, the rate rose by 9.9 bps to 3.348 percent from the previous 3.249 percent.

    Demand was only slightly higher than the P6 billion offering, at P6.827 billion.

    For the one-year securities, the yield fell by 2.6 bps to 3.475 percent from 3.501 percent in the last auction for the same tenor.

    Tenders were nearly four times the fully awarded amount of P6 billion, at P23.101 billion.

    Meanwhile, de Leon said the government has already raised “a little more than half” of the P3 billion premyo bond offering, only about a week since it was launched.