T-BILL RATES UP ANEW AS INVESTORS REMAIN JITTERY
MANILA, SEPTEMBER 10, 2007 (STAR) By Iris C. Gonzales - Treasury bill (T-bill) rates went up again during yesterday’s auction on continued jitters brought about by the ongoing credit crunch in the United States and worries on the results of former president Joseph Estrada’s plunder case trial on Wednesday.
Rates for the benchmark 91-day T-bills went up to 3.769 percent from 3.731 percent during the previous auction last Aug. 28. The highest bid offered by banks stood at 3.800 percent while the lowest rate stood at 3.730 percent.
The Bureau of the Treasury (BTr) awarded P1 billion worth of the debt paper out of total tenders worth P2 billion.
The average rate of the 182-day debt paper also went up to 4.842 percent from 4.805 percent previously.
For this paper, the BTr accepted P1.5 billion worth of bids as tenders reached P4.8 billion.
“There appears to be no interest as you can see in the volume. The bid prices are unreasonable,” Finance Undersecretary and Acting National Treasurer Roberto Tan told reporters after the auction.
As in the previous T-bill auction, however, the BTr rejected all bids for the 364-day paper because banks’ bids were unreasonably high.
A total of P3.5 billion of one-year papers were on sale, but bids amounted to only P3.36 billion.
The average rate offered was 6.058 percent, up from 5.988 percent at the last auction on August 28.
Aside from the government’s fiscal woes, competition from other investment facilities available in the market have affected rates of government debt papers.
Through the SDAs, banks’ trust departments and government-owned and controlled corporations can now park their funds directly with the central bank which offer higher rates compared to government securities.
Tan said competition from the secondary market has also affected the rates.
“There are a lot of securities in the market that they can just go and buy from the secondary market,” Tan said.
Chief News Editor: Sol Jose Vanzi
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