Demand for higher yields for the Treasury bills (T-bills) made the Bureau of the Treasury’s (BTr) auction committee reject anew bids for all tenors Monday.
Had the committee issued the debt paper, the average rate of the 91-day paper would have risen to 3.50 percent, the 182-day paper to 3.775 percent, and the 364-day tenor to 4 percent.
Last week, the auction committee also rejected bids across-the-board.
BTr offered the three-month paper for PHP10 billion but bids only reached PHP7.6 billion.
The 182-day paper attracted PHP4.06-billion bids, also lower than the PHP5-billion offer; while tenders for the one-year tenor reached PHP5.55 billion, higher than the PHP5-billion offer.
In a Viber message to journalists, National Treasurer Rosalia de Leon said they rejected the tenders because “all bids (are) over the roof.”
However, de Leon has high hopes for the auction of the 35-day Treasury bond (T-bond) on Tuesday.
She said the paper “should be appealing and (investors may want to) put their money to work.”
De Leon further said the paper has “very short maturity” so funds will be available when needed.
“There is still (an) opportunity cost for holding on to cash,” she added.
Meanwhile, de Leon said the rate of the PHP300 billion worth of government securities that the Bangko Sentral ng Pilipinas (BSP) bought through a repurchase agreement with the BTr is zero thus, a revenue-neutral deal for the national government.
She attributed the revenue-neutral deal for the debt paper to the goal of providing funds for programs intended to address the impact of coronavirus disease 2019 (Covid-19) without any cost to the central bank.
Under the agreement, the repurchase program has a maximum of six months repayment period. Source: Philippines News Agency