T-bill rates up across the board

Rates for the government short-term securities rose across the board in reference to the secondary market after the US Federal Reserve ruled out monetary policy easing anytime soon.

The Bureau of the Treasury yesterday fully awarded P15 billion in T-bills, marking the sixth straight week of raising the entire offer target. This is also the first T-bill auction for February.

Investors demanded higher rates after the Fed insisted that it wants “more confidence” before it starts easing rates. As such, the Fed ruled out any monetary policy easing once it meets again in March.

The Bangko Sentral ng Pilipinas is already expected to move in lockstep with the Fed after raising key policy rates by 450 basis points since May 2022.

The first rate-setting meeting of the central bank’s Monetary Board for this year is on Feb. 15.

Likewise, rates picked up ahead of the release of the January inflation data.

The 91-day short-dated debt papers saw rates go up by 1.9 basis points to 5.461 percent and above last auction’s level of 5.398 percent.

Rates for the 182-day offer also increased 4.8 basis points to 5.861 percent from the secondary rate of 5.813 percent and is higher from the last auction’s 5.81 percent.

Rates averaged 6.075 percent for the 364-day T-bills, 3.1 basis points higher than the secondary rate and just slightly down from the last auction rate of 6.076 percent.

All securities were awarded at P5 billion each.

On the other hand, demand went up nearly 25 percent to P47.505 billion. The auction was oversubscribed by 3.17 times.

Bids went up across the board to P12.985 billion, P13.94 billion, and P20.58 billion, for the three, six, and 12 months offer.

For this month, the Treasury aims to borrow P210 billion from domestic creditors. Of this,P60 billion is expected to come from short-dated T-bills.