Strong demand for Treasury bills (T-bills) at Monday’s auction led to a drop in average rates for shorter-dated securities while keeping the yield on one-year paper stable. The Bureau of the Treasury received tenders worth ₱90.6 billion for the ₱22 billion in bills offered, a sign of robust investor appetite.
Reflecting favorable market conditions, the Bureau of the Treasury was able to raise ₱30.8 billion, above its original target, by accepting more bids at lower yields. The high demand comes amid expectations of increased liquidity in the financial system, boosted by the Bangko Sentral ng Pilipinas’ (BSP) recent decision to cut the banks’ deposit reserve requirement ratio by 200 basis points. The move is anticipated to inject over ₱300 billion in liquidity, providing further support to government debt instruments.
For the shorter tenors, the 91-day T-bill yield fell to 5.178 percent from 5.283 percent the previous week, while the 182-day paper saw a similar decline to 5.548 percent from 5.610 percent. The 364-day paper, however, remained stable with a marginal increase to 5.773 percent from last week’s 5.770 percent.
The easing in yields highlights the market’s expectation of continued liquidity growth and the potential for further rate adjustments by the BSP as it manages monetary policy. Treasury officials continue to monitor these developments closely as they guide the country’s fiscal strategy.
