PH T-bill rates go down – BSP

By Joann Villanueva, PNA

The average rates of Philippine Treasury bill (T-bill) declined across-the board Tuesday, June 25, 2019, on expectations of further cuts in the central bank’s key rates and anticipation of a fruitful Trump-Jinping meeting on Friday.

Rate of the 91-day paper declined to 4.385 percent from 4.453 percent during the auction last June 17.

The 182-day’s rate went down to 4.723 percent from 4.856 percent previously and the 364-day to 4.986 percent from 5.050 percent.

“We are very happy. We expected it,” Bangko Sentral ng Pilpinas (BSP) Deputy Treasurer Sharon Almanza told journalists after the auction.

She attributed this development partly to expectations that the BSP and the US Federal Reserve will soon ease their respective rates.

Last May, BSP’s policy-making Monetary Board (MB) slashed by 25 basis points the central bank’s key rates after noting the sustained drop of inflation rates and the robust growth of the economy.

The cut was made after the Board hiked the BSP’s policy rates by 175 basis points in 2018 to help address the elevated inflation rate, which peaked at 6.7 percent in September and October.

Meanwhile, the Fed is now expected to cut policy rates after recent hints from US monetary rates officials due to weaker economic outlook.

Almanza said investors are also on a wait-and-see stance regarding the scheduled meeting between US President Donald Trump and China President Xi Jinping, which will be held during the G20 meet in Japan on Friday.

BTr offered the three-month paper for PHP4 billion and the auction committee made a full award. Tenders were nearly threefold at PHP11.14 billion.

Tenders for the six-month paper amounted to PHP16.85 billion, more than thrice the PHP5 billion offer. The auction committee made a full award.

The one-year T-bill was offered for PHP6 billion and awarded in full. Tenders totaled to PHP22.016 billion. (First posted on June 25, 2019 in www.pna.gov.ph)