THE Bureau of the Treasury sold P19 billion in Treasury Bills (T-bills) on Monday as investors flocked to short-term securities and submitted lower bids.
This was an upsize from its P15-billion offering after it doubled the accepted non-competitive bids for the 91-day and 182-day T-bills, allowing it to raise a total of P7 billion each. It fully awarded P5 billion in 364-day T-bills.
The drop in rates across all tenors compared to those from the previous auction paved the way for the auction committee’s decision, according to National Treasurer Rosalia V. De Leon.
Total bids for the auction reached P71.3 billion, making it almost five times oversubscribed compared to the P15-billion original offering.
“Markets flocked to short term as oil prices ease with release of reserves from stockpile. Maturities also added support for reinvestment,” De Leon told reporters in a message.
In a bid to offset the shortfall in Russian crude after the transcontinental country was hit with economic sanctions following its invasion of Ukraine, member nations of the International Energy Agency vowed to release 60 million barrels in the next six months while the United States committed to matching this move, according to reports.
On Monday’s auction, the 91-day T-bills fetched an average rate of 1.25 percent, slipping by 13 basis points from the previous auction’s 1.38 percent.
Meanwhile, the 182-day T-bills capped at an average rate of 1.555 percent, a 22.6-basis-point contraction from 1.781 percent recorded in the last auction.
For the 364-day T-bills, rates dipped by 2.6 basis points to 1.857 percent from 1.883 percent.
The Treasury programmed to raise P200 billion from the domestic debt market this month.
Since Monday last week, the Treasury has so far sold P59.8 billion.
Last month, the Treasury only raised P91.7 billion, more than one-third of its P250 billion programmed offering as investors demanded higher bid rates amid Russia-Ukraine war and the recent hawkish signals from the US Federal Reserve that it could further raise rates if necessary to rein inflation.
This year, the government is set to borrow a total of P2.2 trillion, of which around 75 percent is expected to come from domestic sources.
As of end-February this year, the national government’s outstanding debt rose to another record-high level of P12.09 trillion due to currency fluctuations and net financing from both domestic and foreign sources.