MANILA, Philippines – The treasury bills that are on offer as of the moment are seen to yield higher across the board. The possibility is pushed by the domestic inflation for the year. The Bangko Sentral ng Pilipinas earlier revised its inflation forecast for the years 2017 and 2018. This could potentially lead the central bank to tighten the policy rates in the near future. The United States Treasuries also rose as political noise offshore heightened.
The state expects to raise an amount reaching P15 billion during the auction today. It is allocated as follows, P6 billion in one-month T-bills, P5 billion in six-month T-bills and P4 billion in one-year T-bills.
Bond Traders who expressed their views regarding the matter said that it is probable that the participating banks in the auction will request for a higher yield in the shorter-termed treasury bills. The three-month notes and six-month notes could increase rates by 10-15 basis points. On the other hand, one-year notes are expected to yield higher by 20 basis points.
Another trader said in regards to the appetite of the market towards short-termed notes, these notes are seen to have more demand than that of the longer-termed notes as the requirements for these notes are there. Longer-termed notes, he noted, are more likely to sell weaker, in fact, may be undersubscribed.
The state made a decision to partially award the treasury bills that it auctioned at the end of January this year. This is despite the fact that the appetite for these notes are strong as banks asked for a higher yield which came ahead of the United States Federal Reserve’s policy meeting.
The Treasury Bureau raised a total of P11.302 billion which is lower than planned of P15 billion despite the clear high demand of these notes where investors want to purchase as much as P18.062 billion of the treasury bills.
The three-month T-bills raised a total of P8.86 billion. This is higher than expected amount to be raised amounting to P6 billion. The government awarded these notes In full where the papers were quoted at 1.998 percent. in average rate. The three-month T-bills raised a total amount of P8.86 billion. This is well higher also than what was expected of P6 billion. The average rate for these notes is 1.998 percent. six-month notes raised 5.686 billion but the state accepted only P3.935 billion in bids. The average rate was at 2.252 percent. One-year T-bills raised P1.367 billion which is much lower that the expected P4 billion. The average rate was at 2.571 percent.
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