91-day T-bill rate falls to 0.846%

The uptick in inflation did not stop investors from snapping up short-dated government securities, allowing the Bureau of the Treasury to sell P24 billion in bills at rates that fell across the board on Monday.

The Treasury awarded P7 billion each in the benchmark 91- and 182-day IOUs as it doubled the noncompetitive bids accepted for both tenors.

The original offering was only P5 billion each for the three- and six-month treasury bills.

The 91-day fetched an average rate of 0.846 percent, down from 0.917 percent last week. The 182-day’s yield also fell to 1.094 percent from 1.21 percent previously.

The Treasury also sold all P10 billion in the 364-day securities it offered at an annual rate of 1.446 percent, which declined from last week’s 1.492 percent.

As such, the Treasury’s total award exceeded the P20-billion offer.

Tenders across the three tenors totaled P95.3 billion, making the auction nearly five times oversubscribed.

With P20 billion in IOUs that will mature this week, National Treasurer Rosalia de Leon said domestic liquidity remained strong.

De Leon said price pressures were seen as temporary, referring to the two-year high inflation rate of 4.2 year-on-year percent posted in January—already above the government’s 2 to 4 percent target range—mainly due to expensive food such as pork and vegetables.

De Leon added that the government was working to alleviate elevated inflation by imposing price caps as well as ramping up food importation. —Ben de Vera INQ