Treasury grants partial allotment amid higher rates – Manila Bulletin
After two consecutive weeks of failed domestic borrowing, the national government proceeded with a partial allocation of short-term debt securities despite still high interest rates.
The Treasury Office raised 9.137 billion pesos through three-month, six-month and one-year IOU auctions, with total tenders reaching 23.35 billion pesos, more than the volume of 15 pesos of debt securities placed in the auction book on Monday. , March 14.
The yield on the 91-day Treasury bill, which banks use to price their loans, rose to 1.305% from 0.899% in the previous successful sell-off on February 21.
The office sold 3.037 billion pesos worth of three-month debt securities, less than the 5 billion pesos offered. The investors, however, were demanding 8.959 billion pesos from government security or IOU.
The 182-day Treasury bill rate also rose to 1.458% from 1.157% previously.
The Treasury accepted offers worth 3 billion pesos for six-month notes, lower than the 5 billion pesos it had planned to sell. Investors were willing to buy more, however, as tenders reached 7.22 billion pesos.
The one-year IOU yield also jumped to 1.734% from 1.568% three weeks ago. The government was supposed to sell 5 billion pesos on the 364-day treasury bills, but only granted 3.1 billion pesos.
“Interest rates continue to rise as oil and commodity prices soar and as markets price the takeoff in U.S. rates,” National Treasurer Rosalia de Leon told reporters after the sale to the US. auction.
Monday’s partial borrowing follows four failed Treasury auctions of short- and long-term IOUs after investors sought higher yields due to shocks from the Russia-Ukraine conflict.
On March 8, Finance Secretary Carlos G. Dominguez III said cash flow was not yet an issue for the government thanks to proceeds of 457.8 billion pesos from the sale of government bonds. Five-year Treasury (RTB).
“The government is well placed to meet disbursements despite the [Bureau of the Treasury] rejections at auction,” Dominguez said.
On March 1, the Treasury office concluded its new RTB sale which yielded a coupon rate of 4.875%. The government raised 457.4 billion pesos in new money from the sale.
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