Treasury sells P26-billion in T-bills amid strong demand, low rates

With strong demand and low rates, the Bureau of the Treasury on Monday (June 1) sold P26 billion in T-bills, exceeding the P20-billion offering.

The Treasury awarded P7 billion in the benchmark 91-day debt paper at an annual rate of 2.046 percent, down from 2.058 percent last week.
It also sold P5 billion in 182-day treasury bills at 2.118 percent, slightly up from 2.114 percent previously.

The P14 billion in 364-day IOUs fetched an annual rate of 2.42 percent, down from 2.508 percent during last week’s auction.

While the six-month rate inched up, the Treasury noted in a statement that all three average rates were below those in the secondary market.

The Treasury sold more 91- and 364-day securities than the P5 billion and P10 billion it offered for the two tenors.

It explained that the auction committee doubled the non-competitive bids for three-month debt to P4 billion, and one-year to P8 billion.

Across the three tenors, tenders reached P83.9 billion, making the auction over four times oversubscribed.

National Treasurer Rosalia V. de Leon said the tap facility window was opened to offer another P10 billion of 364-day T-bills.

“Sentiment continues to be in safe assets, but [investors] try to stretch yield with one-year tenor,” De Leon said.

As far as a “jumbo” issuance or another sale of retail treasury bonds (RTB) were concerned, De Leon said the Treasury was “watchful of developments and risk-return tolerance of investors” amid high demand for government securities so far.

The Treasury had programmed to raise P170 billion from T-bill and T-bond auctions in June.

Edited by TSB