T-bill rates mixed amid strong demand

MANILA, Philippines — The Bureau of the Treasury yesterday awarded in full the P15 billion in Treasury bills (T-bills) on offer as lenders opted to reinvest their redemptions from prior bond purchases.

Demand for the short-term securities amounted to P54.034 billion, oversubscribing the offer by 3.6 times, but declining from a week ago’s P71.254 billion.

Rates for the 91-day T-bills declined by 2.7 basis points to 1.223 percent, while that for the 182-day T-bills went up by 1.3 basis points to 1.568 percent.

On the other hand, yields for the 364-day T-bills increased by two basis points to 1.877 percent. The full-year securities fetched a demand worth P11.594 billion.

The three-month debt papers registered the highest volume of bids at P26.23 billion, while the six-month debt paper obtained P15.85 billion in tenders.

National Treasurer Rosalia de Leon said the bond market was swarmed by investors who took the opportunity to reinvest the gains they made from previous investments.

“We saw good demand for T-bills offering with P27 billion in redemption adding to liquidity,” De Leon said in a text message to reporters.

“Market was biased on the short end with anticipated aggressive Fed actions and combined with policy rate hikes and balance sheet runoff as reflected in Fed minutes,” she added.

In March, the US Fed, in a first of many moves, raised its policy rates by 25 basis points and is expected to hike by 150 basis points more for the rest of the year. The Fed has begun tightening its monetary policies to combat soaring inflation.

US inflation jumped by 8.5 percent in March, the highest since 1981, as energy costs spiked to record highs due to Russia’s invasion of Ukraine.

The Bangko Sentral ng Pilipinas (BSP) has maintained the benchmark rate at a record low of two percent.