T-bill rates ease slightly
Iris C. Gonzales
Philippine Star
Treasury bill (T-bill) rates eased across the board during yesterday’s auction by the Bureau of the Treasury (BTr) following a rate cut by the Bangko Sentral ng Pilipinas (BSP) last week.
The average rate of the benchmark 91-day T-bill eased to 3.758 percent from 3.759 percent during the previous auction. The highest bid offered by banks stood at 3.775 percent while the lowest rate stood at 3.733 percent.
The BTr made a partial award of P800 million worth of the debt paper out of total tenders of P1.870 billion.
The average rate of the 182-day debt paper also dropped slightly to 4.812 percent from 4.832 percent previously.
For this paper, the BTr made a full award amounting to P2 billion. The banks’ highest offer stood at 4.850 percent while the lowest bid stood at 4.750 percent. As in the previous T-bill auction, however, the BTr rejected all bids for the 364-day paper because banks’ bids were unreasonably high.
The average rate of the 364-day paper also eased to 5.628 percent from 5.643 percent previously. The highest rate stood at 5.650 percent while the lowest bid by banks went as low as 5.615 percent.
The Treasury bureau awarded P1.69 billion worth of the debt paper, out of total tenders of P3.92 billion.
Deputy Treasury Eduardo Mendiola, who presided in yesterday’s auction, said the auction committee confirmed market expectations.
“The market is looking for a confirmation of what the BSP has done. The BSP has slashed policy rates and we confirmed it by not allowing the rates to go up,” Mendiola told reporters after the auction.
The BSP last Thursday cut its key policy rate by 25 basis points following a recent cut in the US Federal Reserve funds. Monetary authorities eased the overnight borrowing rate to 5.75 percent and reduced the overnight lending rate to 7.75 percent.
Mendiola said there was no reason for T-bill rates to go up.
“The rates should be where they are now. There’s no reason for the rates to go up,” he said.
He also said that the positive performance of the stock market yesterday did not affect yesterday’s auction.
“The volume in the stock market cannot influence the volume in the auction,” Mendiola noted.
At yesterday’s trading, the benchmark Philippine Stock Exchange composite index ended 2.58 percent, or 97.59 points higher, at 3,873.50, a record close.
It hit an all-time intraday high of 3,896.74 points, surpassing the prior intraday record of 3,820.55 last July 13. A total of 7.81 billion shares worth P5.87 billion were traded.
Analysts said investors expect companies to post strong third quarter profits and the economy to continue to perform strongly.
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