Treasury bill rates mostly up
Treasury Bills auction results on Monday, June 16, 2025
MANILA, Philippines – Yields on short-dated local debts of the government mostly climbed during Monday’s sale of Treasury bills (T-bills) as the Israel-Iran conflict unnerved investors.
But auction results showed the Bureau of the Treasury (BTr) was still able to raise P26.7 billion via T-bills, bigger than the original plan to borrow P25 billion.
The offering was thrice oversubscribed after attracting P74.2 billion in total bids.
READ: T-bill yields down on rate cut hopes, slowing inflation
But Michael Ricafort, chief economist at Rizal Commercial Banking Corp., said the strong demand was not enough to bring down the yields, which mostly went up as the attacks in the Middle East spooked markets.
“The Treasury bill average auction yields were mostly marginally higher, but essentially little changed, after the latest Israel-Iran war that led to global crude oil prices rising to new four-month highs and the US dollar-peso exchange rate at new 1.5-months [low],” Ricafort said in a commentary.
“Both of which would lead to some pick up in importation costs and overall inflation, which could potentially delay future Fed rate cuts and BSP (Bangko Sentral ng Pilipinas) rate cuts,” he added.
The BTr said the 91-day T-bill fetched an average rate of 5.459 percent, up from 5.451 previously.
The average yield for the 182-day notes went down to 5.523 percent from 5.524 percent in the last auction.
Local creditors asked for an average rate of 5.657 percent for the 364-day debt paper, higher than the preceding week’s 5.656 percent.
For this year, the Marcos administration is targeting to borrow P2.55 trillion from creditors at home and abroad to plug a projected budget hole amounting to P1.54 trillion, or equivalent to 5.3 percent of the country’s gross domestic product.
By sources of financing, the government will borrow P507.41 billion from foreign investors in 2025. The remaining P2.04 trillion is targeted to be raised domestically, of which P60 billion will be via T-bills and P1.98 trillion via longer-dated Treasury bonds.
