Weak appetite hounds T-bill auction

The yield on the benchmark 91-day treasury bill rose by 17.9 basis points to an average of 1.947 percent as the government moved to temper the rise in interest rates.

As a result, the Bureau of the Treasury raised only P6.831 billion from the planned P9 billion.

Monday’s average for the benchmark bill was 14.7 basis points higher than the corresponding 1.8 percent set for done deals in the secondary market.

Also, interest rates on the 182-day T-bill rose by 17.3 basis points to an average of 2.408 percent while those for the 364-day T-bill went up by 30.4 basis points to 2.709 percent.

The resulting average at the Philippine Dealing and Exchange Corp. was 5.8 basis points higher than the 2.35 percent for the six-month paper, and 19.15 basis points over the 2.5175 percent for the year-long paper.

Finance Undersecretary Gil S. Beltran, who chaired the auction, said in an interview that the results showed the government’s effort to align primary market rates with those in the secondary market.

Had the BTr fully awarded the volumes on offer, the yield on the 91-day bill would have gone up by 23.7 basis points to 2.005 percent.

Likewise, yield on the 182-day bill would have risen 21.1 basis points to 2.446 percent, while that on the 364-day bill would have been up 34.1 basis points to 2.746 percent.

“We could have accepted less (tenders), but it would not be fair to the investors,” Beltran said.

Tenders for the 91-day bill reached P4.77 billion—less than twice the P2.5 billion offer.

Bids for the 182-day bill totaled P4.781 billion, while those for the 394-day bill reached P5.05 billion—both less than twice the P3 billion and P3.5 billion offers, respectively.

Beltran said one reason for the weak appetite for T-bills was the investors’ anticipation of the issuance this week of retail Treasury bonds (RTBs).