BTr awards P20B in T-bills; interest rates fall

The Bureau of the Treasury on Monday awarded all P20 billion in treasury bills it offered, as rates fell across the board on the back of sustained investor confidence in government securities.

At the maiden auction under the Duterte administration, investors tendered a total of P47.1 billion or more than double the offering, reflecting “considerable demand” for government-issued debt paper, the Treasury said in a statement.

The Treasury sold P8 billion in 91-day IOUs maturing on Oct. 19 at an annual rate of 1.447 percent, down 14.1 basis points from 1.588 percent at last month’s auction.

Also fully awarded were P6 billion in 182-day treasury bills that will mature on Jan. 18 next year, whose yield dropped 17.5 basis points to 1.442 percent from 1.617 percent a month ago.

The Treasury likewise accepted P6 billion in 364-day T-bills maturing on July 19, 2017, whose rate declined 29.5 basis points to 1.63 percent from 1.925 percent last month.

Tenders for the 91-day treasury bills reached P15.9 billion; P18.3 billion for the 182-day; and P12.9 billion for the 364-day.

Deputy National Treasurer Erwin D. Sta. Ana told reporters that Monday’s auction reflected investor confidence in the new administration.

The government will borrow P135 billion domestically through the sale of treasury bills and bonds during the third quarter, as the Duterte administration has retained the borrowing program for the year.

The total volume of offering for the third quarter was similar to those in the first and second quarters.

The Cabinet-level, interagencyDevelopment Budget Coordination Committee (DBCC) this month kept the borrowing program for 2016 earlier set by the Aquino administration, which has a mix of 86-percent domestic and 14-percent foreign.

Budget Secretary Benjamin E. Diokno earlier said the borrowing mix for the rest of the Duterte administration would be 80-percent domestic and 20-percent external.

Finance Secretary Carlos G. Dominguez III had also said that while they will lean more toward domestic borrowings, they would borrow from whomever “gives us the best deal.”