MANILA -- A strong demand for the Philippines’ Treasury bills (T-bills) resounded across-the-board Monday but rates were mixed on investors’ cautious stance ahead of important data releases this week.
The Bureau of the Treasury (BTr) offered the bellwether 91-day paper for PHP4 billion and tenders reached PHP11.355 billion. The auction committee made a full award for this tenor.
The average rate of this tenor rose to 3.290 percent from last week’s 3.261 percent but is lower than the 3.6594 percent in the secondary market Monday morning.
Banks submitted PHP17.316 billion worth of bids for the 182-day paper, higher than the PHP5 billion offering. The auction committee made a full award.
The rate of the paper averaged at 4.186 percent, lower than the 4.294 percent last week as well as the 4.2217 percent in the secondary market earlier in the day.
Bids for the 364-day paper totaled to PHP17.712 billion, almost thrice the PHP6 billion offering.
The auction committee made a full award.
The rate of this tenor averaged at 4.899 percent, lower than the 4.900 percent in last week’s auction. This tenor fetched a lower rate at the secondary market Monday morning at 4.8241 percent.
Deputy Treasurer Erwin Sta. Ana told reporters that banks’ wait-and-see stance clearly showed during auction.
“(It) is actually a big data week as you know inflation, GDP plus the Monetary Board policy meeting and it just goes to show that players are really playing it safe and taking a cautious stance at this stage, hence, the more than three times oversubscription in the auction,” he said.
The government is scheduled to report on the country's 2018 second quarter gross domestic product (GDP) figure on Thursday, the same day of the rate-setting meet of the Bangko Sentral ng Pilipinas’ (BSP) policy-making Monetary Board (MB).
Meanwhile, Sta. Ana said the Philippine government is on-track in its plan to issue the yen-denominated Samurai bond this month, possibly in the first two weeks, noting that they are awaiting regulatory approvals.
He declined to give specifics on the tenor except that it will be five years and higher, and the volume, which will have a ceiling, is USD1 billion.
“Based on our deal managers’ feedback, because they have done intensive market sounding, there are robust demand across tenors so the exercise would actually lead to us deciding which tenors will be available for us,” he said.
While the Philippine government is set to report the economy’s second quarter output, Sta. Ana clarified that this is not expected to have any impact on the planned debt issuance in Japan.
“They are separate in a sense that the conditions there are not greatly affected by domestic conditions. So, at least now the Japanese investors have a good grasp of where the credit and the economy is so we would be pricing that transaction on this kind of perception,” he said. (PNA)
