Benchmark rates rise

BENCHMARK interest rates rose across the board at Tuesday’s auction of short-dated Treasury bills.The rate on the three-month T-bill, which banks use in pricing their loans, inched up 5.3 basis points to 3.919 percent from the previous auction.

Banks were willing to buy as much as P3.760 billion of the 91-day debt papers, but the Bureau of Treasury awarded only the scheduled P1.5 billion.

The IOUs fetched 3.978 percent in the secondary market.

For the six-month T-bills, the government awarded in full the P3 billion on offer despite the P7.560 billion tenders, with the rate rising 1.8 basis points to 4.129 percent. Debt papers of the same tenor fetched 4.150 percent on the secondary market.

The auction committee however failed to award in full the P3.5- billion worth of 364-day IOUs, after banks demanded a 4.6-percent yield.

The government raised only P2 billion at 4.566 percent, which is 7.4 basis points higher than two weeks ago.

The one-year debt paper fetched 4.5 percent on the secondary market.

“The yield sought by the investors is moving sideways as compared with the secondary market, and that the investors are waiting at how the government would react if they would ask for a higher yield. But of course, we rejected it and opted for a partial award,” National Treasurer Roberto Tan said after the auction. –KATRINA MENNEN A. VALDEZ Reporter, Manila Times