Treasury finds bid rates too high, rejects all offers for 7-year bonds
The Bureau of the Treasury (BTR) rejected all bids for the new seven-year T-bonds offered yesterday, as investors, who preferred to keep their cash amid the ongoing COVID-19 pandemic, demanded for rates that the BTR deemed too high.
“Bid rates came in higher, reaching 7 percent with an average of 5.583 percent for the maiden issuance,” the Treasury said in a statement.
“Submission was too high compared to our internal estimates and BVAL [secondary market rates],” National Treasurer Rosalia V. de Leon said.
Since it was an original issue, the Treasury did not award or else the coupon would be set at a high of 7 percent, de Leon explained.
Just like Monday’s T-bill auction, investors held on to their cash as de Leon pointed out that “cash remains king” while the COVID-19 disease lingered. —Ben O. de Vera INQ
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