Treasury bill yields ended mixed on Monday as investors weighed easing inflation against lingering uncertainties over the interest rate outlook, with demand remaining strong across all tenors.
The Bureau of the Treasury partially awarded the 91-day Treasury bills, accepting P26 billion out of the P30 billion on offer despite bids reaching P35.14 billion. The average yield rose to 5.188 percent from 5.143 percent at the previous auction, indicating investors demanded higher returns for shorter-dated debt.
The government fully awarded the P20 billion offered in 182-day Treasury bills after attracting P29.59 billion in tenders. The average rate climbed to 5.679 percent from 5.624 percent last week.
In contrast, the 364-day tenor benefited from improved sentiment following the release of slower-than-expected May inflation data. The Treasury awarded the entire P10 billion on offer, with bids reaching P17.25 billion. The average yield edged down to 6.267 percent from 6.269 percent previously.
Total bids surged to P81.98 billion, significantly higher than the P70.5 billion recorded in the previous auction, reflecting ample liquidity and continued investor appetite for government securities.
Market participants said the decline in the one-year yield suggests investors are increasingly positioning for potential monetary easing later this year after inflation moderated in May, strengthening expectations that the Bangko Sentral ng Pilipinas may have room to further calibrate policy settings.
The rise in yields for the shorter tenors, however, indicates that investors remain cautious about near-term risks, including global oil price volatility and external market uncertainties that could affect inflation dynamics in the coming months.
The Treasury raised P56 billion from the auction, slightly below the P60 billion initially offered after rejecting a portion of bids for the 91-day securities.
