By Joann Villanueva/PNA
MANILA — The Bureau of the Treasury’s (BTr) auction committee on Tuesday made a full award of the seven-year Treasury bond (T-bond) and even opened a tap facility to accommodate the especially strong demand for the debt paper.
The full award of PHP15 billion was made after the rate of the debt paper went down to 6.974 percent from the 7.085 percent it fetched during the auction last September 25. Bids for the same tenor were fully rejected during the auction last October 23.
The total bids during the auction on Tuesday reached PHP62.227 billion.
National Treasurer Rosalia de Leon said the auction committee was “pleasantly surprised” with the outcome of today’s auction.
She said investors now prefer longer tenor papers because “they want to lock in rates.”
“The expectations now are rates will be falling already given that inflation is already expected to trend downwards, oil prices are lower, and the peso is appreciating. So they better lock in already on the long end of the curve,” she added.
The rate of price increases last October held steady at 6.7 percent relative to the previous month’s level.
Global oil prices, in turn, have gone down to around USD55 per barrel level after surpassing the USD80 per barrel level last September.
The decline in prices of oil in the international market has benefited the Philippine peso, which is now trading at the 52-level to a dollar from the 54-level a few weeks back.
Relatively, BTr data show that PHP15 billion-worth of the same 7-year bond was awarded through the tap facility, which was opened from 2 to 4 p.m. Tuesday.
Investors offered a total of PHP53.9 billion worth of bids.
