T-bill rates continue to rise

Rates for government securities further went up across the board, breaching three percent, prompting the partial award for shortdated Treasury bills (T-bills) yesterday.

The Bureau of the Treasury made a partial award of P13.16 billion of the P15 billion in T-bills on offer as investors demanded higher yields anew.

Rates for the 91-day Tbills went up by 2.4 basis points to 1.876 percent from the market pricing of 1.852 percent. However, this is lower from last week’s 1.908 percent rate.

Yields for the 182-day short-dated debt papers likewise swelled by 51 basis points to 2.907 percent.

On the other hand, offers for the 364-day averaged at 2.981 percent, rising by 28.8 basis points. It even reached a high of 3.143 percent.

It was in April 2020 when the one-year primary rate last breached the three percent level after hitting 3.371 percent. Inflation at the time was only at 1.8 percent.

Rates for both six-month and one-year tenors went up week-on-week.

The Treasury managed to raise P5 billion from the 91-day, P4.1 billion for 182day, and P4.06 billion for the 364-day T-bills, for a total of P13.16 billion.

Overall demand for the T-bills drew P36.723 billion in bids, oversubscribing the auction by 2.45 times. Bids for yesterday’s auction increased by 12 percent from last week’s P32.759 billion.

By tenor, bids for the three-month, six-month and full-year securities totaled P24.563 billion, P7.05 billion and P5.11 billion, respectively.

National Treasurer Rosalia de Leon said the award is based on the Treasury’s reasonableness test, including guidance from the central bank on the path of rate hike.

The Bangko Sentral ng Pilipinas last week said it is ready to raise interest rates more aggressively with a 50-basis-point increase by next month.