MANILA – Rates of the Philippines’ treasury bills (T-bills) posted mixed results Monday ahead of the initial auction of the Bangko Sentral ng Pilipinas’ (BSP) debt paper later this week.
The rate of the 91-day paper declined to 1.150 percent from last week’s 1.167 percent.
Those of the 182-day paper rose to 1.589 percent from last week’s 1.518 percent.
Meanwhile, the auction committee rejected bids for the 364-day paper after investors asked for high yield.
Had the auction committee awarded this tenor, its average ratio would have risen to 2.050 percent from last week’s 1.807 percent.
The Bureau of the Treasury (BTr) offered the three-month and six-month papers for PHP5,000 and these received PHP26.313 billion and PHP13.134 billion, respectively.
The auction committee upsized the award for the shortest tenor facility to PHP7,000 after doubling the accepted non-competitive bids while the six-month tenor was fully awarded.
Bids for the longest T-bill tenor reached PHP14.705 billion, higher than the PHP10-billion offer.
National Treasurer Rosalia de Leon said they rejected bids for the one-year paper because demand for yield rose as much as 16 basis points compared to last week’s auction, as well as compared to secondary market rates.
“Banks (are also) positioning in anticipation of maiden BSP offering as well as outcome of Fed policy meeting this week,” she told journalists in a Viber message.
Last week, the central bank said it would offer 28-day BSP Bills with an indicative volume of about PHP20 billion on Sept. 18.
Auction volume will be announced two days before the auction date.
Asked for her thoughts on why the one-year T-bill is affected by the scheduled auction of BSP Bills, de Leon said “banks (are) saying (they) will go for 1-year if BTr accepts big pick-up vs. secondary levels.”
The Federal Reserve will have its policy meeting on Sept. 15 to 16, and investors do not expect any major rate decision since Fed officials earlier said rates are expected to remain low to help boost growth of the US economy. (PNA)
