Yield on 91-day T-bills back above 1%

The Bureau of the Treasury on Tuesday awarded all P20 billion in treasury bills it offered even as the rate for the benchmark 91-day reverted above 1 percent due to expectations of faster November inflation.

During the first Treasury auction for December, the P5 billion in three-month debt paper were sold at an average of 1.006 percent, up from 0.986 percent last week.

National Treasurer Rosalia de Leon attributed the pickup in the 91-day rate to the expected higher inflation print in November following the spate of typhoons that battered the country that month.

Most economists had projected a faster rate of increase in prices of basic commodities than October’s 2.5 percent year-on-year as the weather disturbances jacked up food prices.

The Treasury also sold P5 billion in 182-day IOUs at 1.386 percent, which likewise inched up from 1.385 percent previously.

On the other hand, the 364-day treasury bills fetched an annual rate of 1.693 percent, slightly down from 1.695 percent during last week’s auction.

All of the awarded rates were nonetheless still below secondary market benchmarks, the Treasury said in a statement.

Investors tendered P75.9 billion across the three tenors, making the auction over 3.7 times oversubscribed. —BEN O. DE VERA INQ