MANILA, Philippines? (UPDATE) The yield on the benchmark three-month treasury bills went up 0.8 basis point to an average 3.927 percent in the last auction under the administration of President Gloria Macapagal-Arroyo, who will step down from office tomorrow.

Interest rates rose across the board although the government gave a partial award for the year-long bills to keep the increase within ?rational? levels.

Yield on the six-month securities also rose by 2.6 basis points to 4.155 percent.

The year-long debt paper now costs the government 4.619 percent.

The partial award means the government sold only P2.68 billion worth of the one-year bills instead of the planned P3.5 billion.

Had the Bureau of the Treasury awarded its entire offer for the year-long debt paper, the yield would have gone up 7 basis points to 4.636 percent.

The Treasury ended up raising a total of P7.18 billion instead of the planned offer of P8 billion.

Of the total, P1.5 billion came from the three-month bills and P3 billion from the six-month securities.

National Treasurer Roberto B. Tan said yesterday?s results showed that the auction committee only followed the prevailing rates in the secondary market.

Tan said investors have gone past their knee-jerk reaction to the government report about a higher-than-expected budget deficit for the five months to May.

The government spent P162.1 billion over its January-May budget, exceeding the target cap of P145.2 billion for the entire first semester.

?All economic indicators are pointing positively? to better prospects for the rest of the year, he added.

Tan said rates on done deals in the secondary market averaged 4 percent, 4.18 percent and 4.625 percent, respectively, for the three tenors.

In yesterday?s auction, lenders tendered a total of P16.74 billion, or more than twice the P8 billion on offer.

Buyers submitted P4.57 billion worth of bids or more than twice the Treasury?s offer of P1.5 billion for the three-month bills. They tendered P5.63 billion or almost twice the P3-billion offer for the six-month bill, and pitched a total of P6.54 billion against P3.5 billion worth of one-year securities on offer.