The government raised the volume of Treasury bills (T-bills) it awarded in Monday’s auction, despite receiving mixed rates from creditors as the market sought to secure higher yields.
The Bureau of the Treasury (BTr) raised P22.6 billion via the T-bills it offered yesterday, above the initial P20-billion program, as total bids reached P53.1 billion or 2.7 times larger than the original size of the issuance.
Dissecting the auction result, the 91-day T-bills fetched an average rate of 5.947 percent, cheaper than the 5.966 percent in the previous week. Meanwhile, the yield for the 182-day debt paper increased to 6.002 percent from 5.996 percent.
READ: T-bill demand spikes on imminent rate cuts
Interest charged on the 364-day T-bill averaged at 6.040 percent, lower than the preceding week’s 6.022 percent.
“Some investors still seek to lock in longer-dated fixed income or Treasury bond securities while they can in recent weeks before policy rates locally and in the US go down further,” Michael Ricafort, chief economist at Rizal Commercial Banking Corp., said.
Earlier, the Marcos administration returned to the international bond market with a triple-tranche of US dollar-denominated global bonds amounting $2.5 billion.
Ricafort said the recent bonds issuance attracted investor interest and helped absorb some of the extra money that was circulating in the financial system.
For this month, the government is set to raise P195 billion from the domestic market of which P80 billion will come from T-bills and P115 billion through Treasury bonds.
The government borrows from local and foreign sources to help fund its budget deficit, which is capped at P1.48 trillion or 5.6 percent of economic output this year. INQ