The government made a full award of the Treasury bills (T-bills) it auctioned off on Monday as rates increased amid its ongoing retail bond offer.
The Bureau of the Treasury (BTr) raised P15 billion as planned via the T-bills it auctioned off on Monday as total bids reached P33.76 billion, more than double the initial offer but slightly lower than the P37.99 billion in tenders seen in the auction last week.
Broken down, the BTr raised the programmed P5 billion via the 91-day debt papers from P8.78 billion in bids. The three-month T-bills fetched an average rate of 1.178%, up by 2.8 basis points (bps) from the 1.15% seen at last week’s offering.
The BTr also borrowed P5 billion as planned from the 182-day securities it offered on Monday as bids reached P10.86 billion. The average rate of the six-month T-bills went up 3 bps to 1.443% from 1.413% a week ago.
Lastly, the government made a full P5-billion award of the 364-day T-bills as the tenor attracted tenders worth P14.12 billion. The average yield on the one-year instruments stood at 1.628%, inching up by 0.7 bp from the 1.621% fetched last week.
At the secondary market prior to the auction, the 91- 182- and 364-day T-bills were quoted at 1.2171%, 1.4525% and 1.641%, respectively, based on the PHL Bloomberg Valuation Reference Rates published on the Philippine Dealing System’s website.
A bond trader said in a Viber message that the higher T-bill rates fetched on Monday “can be attributed to the ongoing RTB (retail Treasury bond) issuance.”
The Treasury last week raised an initial P113.545 billion at its price-setting auction for its offer of 5.5-year RTBs. This was oversubscribed by more than five times versus the initial P30-billion offer. The RTBs had fetched a coupon rate of 4.625%.
The offer period is set to run from Nov. 16 to Nov. 26, unless the BTr closes it early. The papers will be issued on Dec. 2 and will mature by 2027.
The government previously planned to raise P200 billion from the domestic market in November: P60 billion via weekly T-bill auctions and P140 billion from weekly offers of Treasury bonds (T-bonds). However, the BTr canceled the auctions of P35 billion each in five-year and seven-year T-bonds on Nov. 16 and 23 to give way to its RTB offering.
The government wants to borrow P3 trillion from local and external sources this year to help fund a budget deficit seen to hit 9.3% of gross domestic product. — Jenina P. Ibanez