Yield on 91-day Treasury bill rises to 0.969%

The yield on the 91-day Treasury bill went up Monday by 5.9 basis points to an average of 0.969 percent amid tepid demand for government securities maturing in less than a year.

Monday’s average for the benchmark bill was 10.4 basis points higher than the corresponding rate set for done deals on the secondary market, which settled at 0.865 percent.

Also, interest rates on the 182-day T-bill rose by 8.9 basis points to an average of 1.204 percent, although the Treasury did not make a full award of its P3-billion offer.

The resulting average was 16.4 basis points higher than the prevailing rate at the Philippine Dealing and Exchange (PDex) Corp. at the time of the auction.

Finance Undersecretary Gil S. Beltran, who chaired the auction committee in lieu of National Treasurer Roberto Tan, also said in an interview that the government wanted to keep primary-market rates as close to PDEx rates as possible.

“The range of bids for the 364-day T-bill was too wide at 1 percent to 4 percent,” Beltran said, explaining the withdrawal of the P4-billion offer for that tenor.

He said that there are indications that uncertainty in the market has simmered down in the past two weeks, considering that an apparent solution to the Italian government’s debt woes has been found.

Beltran was referring to changes in the Italian government amid financial troubles that are threatening the stability of the eurozone.

“The situation has become clearer for the eurozone,” he said. “But there is still uncertainty in the market. It would probably take another two weeks before investors absorb the good news.”

The government raised a total of P3.15 billion, or just about a third of the planned P9 billion while buyers tendered a total of P6.22 billion.

Tenders for the three-month bill reached P4.19 billion or more than twice the P2 billion offer.

Bids for the six-month bill totaled P3.57 billion, or a little over the P3 billion offer, while those for the year-long bill reached P3.07 billion, or three quarters of the P4 billion offer.