BTr makes partial award of latest T-bills offer

INQUIRER FILE PHOTO

The Bureau of the Treasury (BTr) on Monday made a partial award of its 180-day and 364-day Treasury bills (T-bills), raising P8.6 billion out of the P15 billion offered in its latest auction ahead of this week’s expected announcement of a rate hike by the Bangko Sentral ng Pilipinas (BSP).

In contrast, the Treasury awarded in full its latest offering of 91-day T-bills during the day’s auction, which saw rates capped at 4.464 percent, 4.838 percent, and 5.100 percent, respectively.

“Average rate is still within secondary level with modest premium to account for illiquidity premium and expectation for point-by-point match rate hike by BSP with that of Fed,” National Treasurer Rosalia de Leon told reporters, noting that inflation has yet to peak with added pressure from supply constraints due to the damage caused by recent typhoons.

Back on Nov. 7, the auction committee also partially awarded bids for T-bills and raised a total of P6.7 billion of the P15-billion programmed offering.

The rates for all three were capped at 4.350 percent, 4.800 percent and 5.000 percent, respectively.

The previous auction was 1.4 times oversubscribed, attracting P21.5 billion in total tenders.

The latest auction rates come just before the BSP’s planned announcement of a policy rate hike, which will be made during the scheduled meeting of the monetary policy board on Nov. 17.

The Philippines’ central bank intends to raise it by 0.75 percentage point, matching the rates of the United States’ Federal Reserve, and bringing it to 5 percent.

“By matching the Fed’s rate hike, the BSP reiterates its strong commitment to its mandate of maintaining price stability by aggressively dealing with inflationary pressures stemming from local and global factors,” BSP Governor Felipe Medalla said in a statement earlier this month.

The Central bank official made the announcement following the US Fed’s own announcement that their target range for the federal funds rate was raised to 3.75 percent-4 percent from the 3 percent to 3.25 percent that had been in place since Sept. 21.