Treasury bill yields fall in first auction for 2021

The Bureau of the Treasury on Monday raised P24 billion from its first domestic fundraising for 2021 where rates fell across the board.

The Treasury awarded P7 billion in the benchmark 91-day debt paper at an average rate of 0.987 percent, down from 1.022 percent during the last auction in December last year.

It also sold P7 billion in 182-day securities at 1.369 percent, down from 1.4 percent previously.

The Treasury offered P5 billion each in the three- and six-month securities, but doubled the noncompetitive bids it awarded following strong demand and low bid rates.

The P10 billion in 364-day treasury bills fetched an annual rate of 1.614 percent, down from 1.686 percent.

National Treasurer Rosalia de Leon said the Treasury would sell another P10 billion in the one-year bills to the 11 government securities eligible dealers through its tap facility window.

De Leon attributed the lower rates to expectations that headline inflation eased in December compared to the 3.3-percent year-on-year spike on November as a result of bad weather-induced food price increases.

De Leon added that domestic liquidity was boosted by the maturity of P21 billion in short-dated bills this week.

In all, investors tendered P83.64 billion across the three tenors, making the P20-billion auction more than four times oversubscribed.

Out of this year’s programmed total borrowings of P3.03 trillion, domestic sources will account for the bulk amounting to P2.58 trillion.

The national government last week requested the Bangko Sentral ng Pilipinas to extend a P540-billion short-term borrowing under their repurchase agreement after the Treasury repaid the same amount borrowed in October. Ben O. de Vera