Only 70% of target T-bills sold in March

By Louise Maureen Simeon | The Philippine Star
March 28, 2023

MANILA, Philippines — The government failed to reach its borrowing program for short-term securities this month as it raised only P52 billion or roughly 70 percent of its intended amount amid higher interest rates here and abroad.

The Bureau of the Treasury yesterday made a partial award of P8.553 billion in Treasury bills, short of the P15-billion target. This is the last T-bills auction for March.

This brought total T-bills raised for the month to P51.731 billion, which is 69 percent of the target P75 billion to be borrowed from the local debt market.

For the entire month, the Treasury just made partial awards for the five auctions set.

Rates were largely on an uptrend the past five weeks amid persistent inflation, consecutive global banking turmoil and the continued tightening of the US Federal Reserve.

The Bangko Sentral ng Pilipinas also delivered a 25-basis-point hike last week.

Yesterday’s auction marked the seventh week of partial award for T-bills, with the amount raised the lowest in nearly four months or since the P7.1 billion on Dec. 5.

Rates for the 91-day T-bills surged by 18.2 basis points to 5.149 percent from the secondary rate of 4.967 percent and above last week’s 4.911 percent.

On the other hand, the 182-day short-dated debt papers saw rates pick up by 11.8 basis points to 5.677 percent from the reference rate of 5.559 percent. This was higher as well from last auction’s 5.556 percent.

The Treasury just accepted P1.428 billion and P2.125 billion for the 91-day and 182-day, respectively, instead of P5 billion each.

For the 364-day T-bills, rates averaged 5.987 percent, 4.7 basis points above the secondary rate and above last week’s auction rate of 5.864 percent.

Still, the Treasury awarded the entire P5 billion for the one-year tenor.

On the other hand, overall demand for the short-term securities improved by 31 percent to reach P23.252 billion, from last week’s P17.81 billion. The auction was oversubscribed by 1.55 times.

Bids went up for the three month and one-year offer to P6.038 billion and P11.579 billion, respectively. Tenders, however, declined to P5.635 billion for the 182-day papers.