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Securities demand reverts to long-end, prompts tap

Joshua Lao

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Rate uncertainty over long-term securities have prompted securities investors to bid the most on one-year Treasury bills and compelled the Bureau of the Treasury (BTr) to open the tap facility to accommodate the flood of bids on Monday.

The one-year T-bill benchmark averaged 3.475 percent or a 2.6 basis point improvement from 3.501 percent.

National Treasurer Rosalia de Leon expressed her satisfaction with the auction outturn as she noted the slight increment in the shorter-dated T-bills the agency considers insignificant.

“We had a full award for all tenors and we’re going to open the tap for the 1-year benchmark given the strong demand. We also saw a very marginal decline in terms of the offer so (we’ll open) P6 billion for the tap,” De Leon told reporters.

The rates for the 91-day and 182-day T-bills averaged 3.192 percent and 3.348 percent, respectively, reflecting a 2.4 and 9.9 basis point uptick from the previous 3.168 percent and 3.249 percent on the same.

“In terms of the expectations (for shorter papers), it’s going to increase in terms of the inflation path for next year. So, for shorter tenors, (the increase) is not really significant (as) we still see a very healthy submission” of bids, she added.

According to her, the flush of liquidity resulting from the cut in the banks’ deposit reserves as well as maturing National Government loans in November helped raise the demand for the securities.

De Leon also expressed her satisfaction with their recently launched Premyo Bond, saying they have already sold more than half of their P3 billion target.

“We’re a little more than half of the target but we still have to see. We’re on the second week and for some associations and provident funds, they still have to secure approval from their respective boards,” De Leon said.

“We’re really focused to cast the net far and wide (and) capture more individuals and know more about the product and to get into the habit of investing, opening bank accounts,” she said.

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