INVESTORS lapped up Treasury bills (T-bills) with longer tenors as the Bureau of the Treasury (BTr) rejected all bids for the 91-day tenor bucket during Monday’s auction.
Rates would have shot up by 34.5 basis points, settling at 5.641 percent compared to the previous rate of 5.295 percent, had government fully awarded the P4 billion on offer for the 91-day tenor. Bids were also undersubscribed at P3.131 billion.
“I think their preference now is to really go longer,” National Treasurer Rosalia V. de Leon said. “[Investors] are now inching toward the longer part of the yield curve; they are ready to lock in the rates at this point. So [investor] preference is now going toward the long.”
The 182-day and 364-day tenor buckets were both fully awarded at P5 billion and P6 billion, respectively.
The 182-day T-bill was also awarded the full P5 billion on offer with tenders reaching P16.203 billion at an average annual rate of 6.294 percent. This is 1.4 basis points higher than the previous rate of 6.280 percent.
For the 364-day tenor, bids amounted to P9.945 billion being awarded the full P6 billion on offer at an average annual rate of 6.550 percent. This posted an increase by 2 basis point from the previous rate of 6.530 percent.
Last week investors of government securities flocked to the BTr tap facility with bids increasing to P50.976 billion for the reissued five-year Treasury bonds (T-bonds) compared to the tenders received—at P48.857 billion—during the auction for the security earlier in the afternoon.
De Leon told reporters they decided to open the tap facility due to oversubscription—more than threefold—for the reissued five-year T-bond, with tenders reaching P48.857 billion at a reasonable 7.003-percent average annual rate.