Bureau of the Treasury's (BTr) auction committee on Tuesday rejected bids for the four-year Treasury bond (T-bond) after banks asked for higher yields.
BTr offered the debt paper for Php 25 billion and tenders totaled to Php 26.128 billion.
Had the auction committee accepted the bids, rates would have risen to over four percent as against the 3.977 percent during the auction last Nov. 22.
National Treasurer Roberto Tan told reporters after the auction that "the market is still quite unsettled because of what is being anticipated from the Fed."
The Federal Reserve's Federal Open Market Committee (FOMC) will have its policy meeting on Dec. 13-14 and markets have priced in a rate hike after the two-day gathering.
Tan said they decided to reject bids because they were higher than the previous rate and the secondary market rate for the same tenor in the afternoon trade, which was at 4.1315 percent.
"We discussed it quite extensively that it will be better to come up, in the next auction, for a bond issuance when the market has already absorbed and digested the Fed action happening next week," he said.
Tan said bids were higher than volume offered because there were about Php 8 billion maturing t-bonds this week.
Source: Philippines News Agency