35-day T-bills fetch lower rate

MANILA, Philippines — Government securities maturing in 35-days continued to fetch lower rates amid strong demand from investors, according to the Bureau of the Treasury (BTr).

During yesterday’s auction, the BTr  fully awarded P15 billion worth of 35-day Treasury bills (T-bills) at an average rate of 1.157 percent, 52.7 basis points lower than the 1.684 percent recorded in the previous auction.

National Treasurer Rosalia de Leon said this was the lowest average rate ever fetched by the 35-day debt papers.

“I would suppose (this is the) lowest since (we) have not issued 35-day tenor in recent years,” De Leon said.

The rate was, likewise, lower than the secondary market rate for comparable securities, namely one-month debt papers, which settled at 1.263 percent the previous day.

The P15 billion offering was more than twice oversubscribed, with total tenders amounting to P31.725 billion.

According to de Leon, the results of the auction reflects the market’s continued preference for low-risk government securities amid strong liquidity in the financial system.

“(Investors are) parking liquidity in government securities,” she said.

Despite the strong demand, de Leon said the auction committee decided not to open the tap facility for the 35-day T-bills.

Meanwhile, de Leon said the BTr is “working on” a possible prize bond issuance.

Currently, the government is offering five-year Retail Treasury Bonds (RTB) at a coupon rate of 2.625 percent. The RTB sale is scheduled to be closed on Aug. 7.

Earlier, de Leon said money raised from the government’s ongoing retail Treasury bond (RTB) sale has already exceeded the record-high of P310.8 billion issued early this year.

To ensure the wider participation of individual investors in the RTB sale, the BTr said investors may use the RTB Online Ordering Facility through its website. Investors may also use the BondsPH  mobile application of the Union Bank of the Philippines.