The government rejected Monday all bids for the 91-day treasury bills, saying that the interest rates sought by the banks were too high.
There was considerable appetite for the three-month debt instrument, with tenders reaching P2.765 billion, but the auction committee of the Bureau of the Treasury did not accept the bids.
“We could not accept the bids for the 91-day bills. The rates (sought by the market) were too high,” National Treasurer Roberto Tan told reporters following the auction.
He said the rates sought for the 91-day bills were even higher than the yield on the 182-day bills.
This should not be the case, he said, adding that longer-dated instruments should fetch higher rates than those of a shorter maturity.
Had the auction committee accepted bids for the three-month debt instruments, its rate could have increased by 13.3 basis points to 2.627 percent from the 2.494 percent registered in the treasury bill auction two weeks ago.
The government, however, accepted bids for the 182- and 364-day government securities.
Tan said the rates sought by the market for these instruments were “reasonable.”
The latest rate for the six-month debt papers reached 2.4 percent, down by 5 basis points from the previous rate of 2.45 percent.
Bids for the six-month debt instruments reached P4.69 billion, but the government decided to sell only P2 billion in keeping with its borrowing schedule.