Yield on 91-day treasury bills inches up to 0.08%

Interest rates on treasury bills continued to stay below one percent on Monday amid mixed results, with that on the 91-day paper inching up by 3 basis points to 0.08 percent.

National Treasurer Rosalia V. de Leon said in an interview after the auction that the previous yield on the benchmark bills might have been too low that the market corrected upward.

She said the government needed to redeem some P76 billion worth of maturing treasury bonds this week.

For the 182-day bills, the average rate fell by 6 basis points to 0.27 percent. Similarly, that for the 362-day securities plunged by 19.8 basis points to 0.57 percent.

The Treasury raised a total of P15 billion as planned. Investors tendered a total of P38.6 billion or more than twice the total offering and higher than the previous month’s level.

For the benchmark bills alone, tenders reached P4.96 billion or more than twice the P2 billion on offer. Lenders made available P11.94 billion for the 182-day bills and P21.7 billion for the 364-day paper, both more than twice the offer.

The latest rate for the 91-day bills was 4.5 basis points higher than the corresponding 0.35 percent for done deals at the Philippine Dealing and Exchange Corp.

At the secondary market, prevailing rates for the 182-day bill was eight basis points higher at 0.35 percent, and for the 364-day bills, 4.3 basis points higher at one percent.

In a joint research issued last month, First Metro Investments Corp. and the University of Asia and the Pacific said the new Treasury auction scheme “will continue to attract aggressive bidding in the primary markets and will stimulate higher volume trading in the secondary market especially by those left out by the limited supply.

Starting in January, the Treasury has been conducting monthly auctions for both treasury bills and bonds. Previously, auctions were held every two weeks.

“This (schedule) may push forth prospects for the Philippines in regaining the second or even the top spot in Asia in terms of turnover ratio,” FMIC and UA&P added.