Rates of the two longer-term T-bill tenors rose on Monday as domestic creditors awaited President Marcos’ plans in fighting high inflation and reverting the budget deficit to prepandemic levels.
The Bureau of the Treasury (BTr) had to cap the yield of the one-year debt since “awarding beyond 3.5 percent is an excessive cushion against inflation as we saw recent drops in oil prices,” National Treasurer Rosalia de Leon said.
As a result, the BTr sold just sold P3.75 billion out of the P5 billion it offered for the 364-day debt paper. By awarding just a chunk of the bids, the annual yield was capped at 3.356 percent, an increase from 3.258 previously.
Another P5 billion was raised from 182-day securities, even as the rate rose to 3.143 percent from 3.083 percent previously.
Only the average rate for the benchmark 91-day treasury bill declined, allowing the BTr to borrow P5 billion. The yield dipped to 2.273 percent from 2.323 percent last week.
The BTr borrowed on Monday a total of P13.75 billion, below the P15-billion offering.
De Leon said government securities eligible dealers (GSEDs) were “waiting for President Marcos’ State of the Nation Address message especially the administration’s priorities and initiatives to curb the inflation rise.”
Due to expensive food and oil, headline inflation averaged 4.4 percent during the first half, above the Bangko Sentral ng Pilipinas’ (BSP) 2- to 4-percent target range of manageable price hikes. To prevent high global inflation further spilling over to the local economy, the BSP already hiked the policy rate for bank loans by 125 basis points to 3.25 percent so far this year. Interest rate hikes by central banks worldwide had been pushing public and private borrowing rates up. INQ