THE GOVERNMENT made a full award of the 35-day Treasury bills (T-bills) auctioned off on Tuesday on strong demand as investor appetite for short-term papers continues to strengthen.
The Bureau of the Treasury (BTr) on Tuesday raised P15 billion as planned via the 35-day papers out of bids worth P33.422 billion.
To accommodate excess demand, the BTr also opened its tap facility to raise another P10 billion.
The 35-day papers fetched an average rate of 2.024%, down by 1.8 basis points (bps) from the 2.042% fetched in the previous auction on May 5.
National Rosalia V. de Leon said the auction was met with strong reception from investors who showed “strong preference” for the short-term papers.
Ms. De Leon said this was evident in the oversubscription, as the total tenders were two times more than the programmed offer.
“Saw sustained investor strong preference for short end with twice subscription for P15 billion offering. Rates further declined from previous 35-day auction,” she told reporters via Viber yesterday.
The BTr has been making full awards and opening its tap facility since the first half of April on declining rates and robust demand as investors flocked to safe-haven assets amid lingering uncertainties.
“Strong interest for short dates persisted as reflected in the good volume subscription with investors opting to put liquidity to work in this part of the curve,” Kevin Palma, peso sovereign debt trader of Robinsons Bank Corp. said in a Viber message.
On Monday, the BTr upsized the T-bills it awarded to P24 billion as total bids reached P103.8 billion, with rates falling across-the- board.
The Treasury also raised another P5 billion in one-year papers via the tap facility.
The government is planning to borrow P170 billion from the local market this month: P110 billion via its weekly T-bill auctions and the remaining P60 billion via Treasury bonds to be offered fortnightly. — B.M. Laforga