Connect with us

Hi, what are you looking for?


T-bill rates may move sideways ahead of Treasury’s RTB offer

RATES of Treasury bills (T-bills) on offer this week will likely move sideways ahead of the government’s sale of three-year retail Treasury bonds (RTBs).

The Bureau of the Treasury (BTr) is looking to raise P20 billion from the T-bills on offer on Monday, broken down into P5 billion each via the 91- and 182-day debt papers and P10 billion from the 364-day instruments.

Rates of the short-term debt will likely inch down by 5 to 10 basis points (bps) amid abundant liquidity in the market, a bond trader said by phone on Friday.

Meanwhile, another trader said the auction would still attract lower yields despite the upcoming RTB sale this week as there is strong demand for the shorter-tenored T-bills.

“Yields for T-bills will move sideways to down by around 5 bps since end-users are still looking to purchase T-bills. For now, traders may limit trading short-term bonds until the rate setting of the RTB,” the trader said via Viber over the weekend.

The BTr last week hiked the volume of T-bills it awarded to P24 billion from the P20-billion program as total bids reached P103.65 billion and rates declined across the board.

Broken down, the BTr borrowed P7 billion via the 91-day debt, more than the P5-billion plan, from P19.56 billion in bids. The three-month papers fetched a lower average rate of 0.917% against the 0.969% quoted in the Jan. 25 auction.

The government also raised P7 billion via the 182-day T-bills, above the P5-billion program, as tenders amounted to P33.456 billion. The average rate of the six-month debt declined by 11.3 bps to 1.21% from the previous week’s rate of 1.323%.

The Treasury, meanwhile, made a full P10-billion award of the 364-day securities it offered at an average rate of 1.492%, down 5 bps from 1.542% previously.

Meanwhile, the BTr will hold the rate-setting auction for the three-year RTBs on Tuesday as it looks to raise at least P30 billion from the retail papers. It will offer the bonds in denominations of P5,000 from Feb. 9 to March 4, unless ended earlier.

The second trader expects the rate of the three-year bonds to range from 2% to 2.375%.

“The issuance comes at a time when inflation for the previous month was higher than the expected consensus and above the target range of the BSP (Bangko Sentral ng Pilipinas),” the trader said.

The government offers RTBs to encourage small retail investors to invest, with higher returns than prevailing market rates. These are also considered low-risk investments because they are backed by the state.

At the secondary market on Friday, the 91-, 182, and 364-day T-bills were quoted at 1.041%, 1.204%, and 1.416%, respectively, while the three-year tenor fetched 2.074%, based on the PHL Bloomberg Valuation Reference Rates published on the Philippine Dealing System’s website.

The second trader said yields on government securities on offer this week will also be affected by rising interest rates in the United States as markets await the $1.9-trillion stimulus package of US President Joseph R. Biden, Jr. 

“This may be offset by slower local loan growth since banks remain wary of credit risks and some banks may be looking to place excess liquidity in safer assets,” the trader added.

Bank lending contracted for the first time in more than 14 years in December as lenders tightened credit standards while demand for loans remained weak.

Latest central bank data showed outstanding loans by big banks went down by 0.7% to P9.178 trillion that month from P9.242 trillion a year ago, turning around from the 0.5% uptick in November. It was the first decline since September 2006’s 1.9% contraction.

The BTr plans to borrow P140 billion from the local debt market this month: P80 billion via weekly auctions of T-bills and P30 billion from a Treasury bond offer.

The government is looking to raise P3 trillion this year from domestic and external lenders to help fund its budget deficit seen to hit 8.9% of gross domestic product. — B.M. Laforga

Click to comment

Leave a Reply

Your email address will not be published. Required fields are marked *

Get the daily email that makes reading the news actually enjoyable. Stay informed and entertained, for free.
Your information is secure and your privacy is protected. By opting in you agree to receive emails from us. Remember that you can opt-out any time, we hate spam too!



JAKARTA — Armed with the world’s largest reserves of nickel and a ban on the export of nickel ore, Indonesia is making itself indispensable...


LONDON — Britain faces its largest ever strike by health workers on Monday as tens of thousands of nurses and ambulance workers walk out...


SINGAPORE — Polluting single-use plastic production rose by 6 million tons per year from 2019 to 2021 despite tougher worldwide regulations, with producers making...


BAMAKO — The Malian interim government on Sunday said the head of the United Nations (UN) peacekeeping mission’s human rights division had 48 hours...


LVIV — Ukraine has sent letters to companies that back the International Olympic Committee (IOC) urging them to keep Russian athletes out of the...


SYDNEY — Australian Prime Minister Anthony Albanese will push for bipartisan support on a referendum that aims to set up an Indigenous consultative committee...

You May Also Like


Browsing history makes referring to sites and pages you’ve visited in the past seamless. It’ll help you recall what page you checked out on...


The minute that any question pops into your head, you can simply ask Google. No longer do we have to pour over books and...


Having a good Instagram marketing agency to back up your Instagram account is an absolute must going into the new year. With competition stronger...


Insomnia is the most common sleep disorder in the global population. Therefore, it is a problem that many people suffer or have suffered throughout...

Disclaimer:, its managers, its employees, and assigns (collectively "The Company") do not make any guarantee or warranty about what is advertised above. Information provided by this website is for research purposes only and should not be considered as personalized financial advice. The Company is not affiliated with, nor does it receive compensation from, any specific security. The Company is not registered or licensed by any governing body in any jurisdiction to give investing advice or provide investment recommendation. Any investments recommended here should be taken into consideration only after consulting with your investment advisor and after reviewing the prospectus or financial statements of the company.

Copyright © 2021 SmartRetirementReport. All Rights Reserved.