Investors devour T-bills as regulators promise economic rebound

Demand for short-dated T-bills stayed strong and pulled down rates of the two longer tenors as monetary authorities in the Philippines and the United States have committed to keep supporting the global economy en route to recovery from the pandemic-induced recession.

The Bureau of the Treasury sold P22 billion in debt paper during Monday’s auction, a bigger amount than its P20-billion offering, after it awarded double of the noncompetitive bids for the 182-day bills.

As such, P7 billion of the six-month treasury bills were accepted, instead of just P5 billion, at 1.348 percent, down from 1.36 percent last week.

The Treasury also fully awarded P10 billion in 364-day securities at an annual rate of 1.582 percent, down from 1.605 percent previously.

On the other hand, the P5 billion in the benchmark 91-day IOUs fetched an average rate of 0.984 percent, up from 0.977 percent, although still below 1 percent for the third straight auction.

Across the three tenors, investors tendered a total of P87.1 billion, making the domestic fundraising four times oversubscribed.

“Liquidity remains strong, particularly on the front-end,” National Treasurer Rosalia de Leon said.

Declining yields and robust demand also reflected the “assuring statements from Bangko Sentral ng Pilipinas Governor Benjamin DIokno to continue supportive policies for economic rebound as well as US Federal Reserve Chair Jerome Powell’s message to keep rates low,” De Leon added.

The Treasury opened its tap facility window to sell another P10 billion of the one-year T-bills to 11 government securities eligible dealers-market makers. INQ