91-day T-bill rate eases but longer tenor yields rise

MANILA -The average rate on the benchmark 91-day Treasury bills decreased by 3.3 basis points (bps) as the government was able to make a full award after two weeks of not being able to raise the planned amount of fresh funds.

The yield on the three-month T-bills eased to 5.671 percent from 5.704 percent last week.

Meanwhile, the average yield on the 182-day T-bills increased by 4.1 bps to an average of 5.986 percent from 5.945 percent.

Also, the average rate on the 364-day T-bills increased by 0.9 bps to 6.334 percent from 6.325 percent.

“The auction was 2.9 times oversubscribed with total bids reaching P43 billion,” the Bureau of the Treasury (BTr) said in a statement.

“With its decision, the [auction] committee raised the full program of P15 billion for the auction,” the BTr added.

The results were also mixed when compared with prevailing rates at the secondary market.

At the Bloomberg Valuation Service, the yield on the three month bill was 3.4 bps higher at 5.765 percent.

Also, the yield on the six-month bill was 1.4 bps higher at 6 percent. Meanwhile, the average rate for the yearlong bill was 0.5 bps lower at 6.329 percent.

Michael Ricafort, chief economist at the Rizal Commercial Banking Corp., said that auction results were “mostly higher” compared with last week’s as the benchmark for US Treasury yields reached a new high in nearly 16 years or since October 2007 at 4.34 percent for the American 10-year debt paper.

Ricafort said yields on the local T-bills were also higher in the wake of signals of hawkish pause—or readiness to hike rates, if needed—from Philippine monetary authorities.

He said there were also signals of no reduction in banks’ reserve requirements for now. INQ