The Bureau of the Treasury on Tuesday (April 14) sold P30 billion in one-year T-bonds as demand for government securities continued to be strong in light of expected further monetary easing by the Bangko Sentral ng Pilipinas (BSP).
The bonds maturing on March 20, 2021 and carved out of seven-year IOUs first issued in 2014 fetched an average annual rate of 3.675 percent, within secondary market levels but higher than the coupon of 3.5 percent.
National Treasurer Rosalia V. de Leon noted that Tuesday’s auction was more than twice oversubscribed as tenders reached P66.685 billion.
“Liquidity is strong,” said De Leon, attributing this to statements made by BSP Governor Benjamin Diokno about further reductions in bank reserve requirements and policy rates.
Since this week’s T-bill and T-bond auctions were both fully awarded, De Leon said “funds [were] ready to deploy for social amelioration and wage subsidy.”
The social amelioration program under the Bayanihan to Heal as One Act extended cash dole outs to poor families, while the wage subsidy announced on Tuesday will be granted to workers of micro, small and medium enterprises (MSMEs) who had been displaced by lockdowns aimed at preventing transmission of COVID-19.
Taking advantage of the robust demand, the Treasury opened its tap facility to sell P10 billion more of the same T-bonds.
Last Monday, the Treasury sold another P855 million in 182-day and P5 billion in 364-day T-bills via the tap facility window.