The Bureau of the Treasury (BTr) awarded P22.6 billion in Treasury bills on Monday as investors sought higher yields from longer-tenor debt papers.

The BTr said the award was higher than the total initial program of P20 billion for 91-day, 182-day, and 364-day papers.

The programmed offer both for 91-day and 182-day papers was P6.5 billion and P7 billion for the 364-day papers.

The Treasury bills attracted 2.5 times oversubscription amounting to P53.1 billion.

The BTr made a full award of the P6.5 billion three-month papers as the average rate fell to 5.947 percent from 5.966 percent recorded in the previous auction on 27 August.

The Treasury, however, raised its award for the six-month papers to P9.1 billion from P6.5 billion as total bids climbed to P19.3 billion. The papers fetched a higher average rate of 6.002 percent from 5.996 percent.

For the one-year papers, BTr awarded the full initial offer of P7 billion as the average rate increased to 6.040 percent from 6.022 percent.

Rizal Commercial Banking Corp. chief economist Michael Ricafort said investors aimed to maximize gains before a possible downtrend in interest rates.

“Some investors in recent weeks locked in investible funds in longer-dated tenors amid the easing trend in local and global bond yields after the -0.25 percentage point local policy rate cut last month,” he said.

Ricafort said the Bangko Sentral ng Pilipinas might further ease the rate in the remaining months, taking cues from remarks by US Federal Reserve’s officials in maintaining healthy investment and foreign exchange levels.

3 Fed easing forecast

“The Federal Reserve is expected to start three series of rate cuts from 2024 to 2026 that could be matched locally,” he said.

Moreover, Ricafort said investors might be looking to secure additional funds after the Philippine government’s newest US-denominated bond offer last month.

“The results also came after the $2.5 billion Philippine government global bond issuance which siphoned off some of the excess liquidity from the financial system,” he said.

Through the BTr, the Department of Finance (DoF) aims to achieve a gross financing of P2.57 trillion for this year. The DoF reported its gross financing stood at 61 percent of the target as of June, following the government’s earlier issuance of a $2 billion global bond in May.