Reissued T-bonds fetch higher rates

MANILA, Philippines - Reissued five-year Treasury bonds (T-bonds) fetched higher yields during yesterday’s auction as traders continued to be on the lookout for more catalysts in the market, the Bureau of the Treasury (BTr) said.

The P15-billion offering fetched an average rate of 4.132 percent, 10.2 basis points higher than the 4.03 percent posted last Feb. 21.

It was also higher than the secondary market rate of 4.0133 percent recorded before the auction closed.

Total tenders amounted to P26.6 billion, almost twice the P15 billion offering.

The BTr awarded all the P15 billion in T-bonds with remaining life span of four years and 10 months on the back of strong demand from the market.

This is the second reissuance of the said T-bonds. It was originally offered last Jan. 25 with a coupon rate of four percent.

“The auction was quite successful, we received close to twice the size on offer,” national deputy treasurer Erwin Sta. Ana, told reporters after the auction.

“We received a bit of an increment from the last five-year auction that we had last month, closely 10 basis points increase. I think this increase is really brought about by the general adjustment in the curve,” he said.

According to Sta. Ana, the market is currently looking for signals from the external and domestic markets.

“The market is clearly waiting for other signals externally and developments onshore, like how our inflation will build up in next couple of weeks, and results of Monetary Board meeting, so those are the factors to these results,” Sta. Ana said.