Rates of short-dated IOUs, or treasury bills, dropped across the board at yesterday auction as investors expect a slower inflation rate in the final month of last year.
During the Bureau of the Treasury’s first auction for 2021, the rate of three-month papers fell to 0.987 percent from previous 1.022 percent, allowing the government to raise P7 billion as planned.
Yield of six-month notes also dropped from 1.400 percent to P1.369 percent that also raised the P7 billion program.
Local creditors also asked for a lower rate for one-year papers at 1.614 percent from 1.689 percent last December 14.
Demand for 91-, 182-, and 364-day Treasury bills reached P83.63 billion, well above the P24 billion offer.
National Treasurer Rosalia De Leon welcomed the strong market participating during the first domestic borrowing activity of the government. De Leon said rates were lower ahead of today’s December inflation report, which they expect will ease. The treasury also opened its tap facility for additional P10 billion worth of one-year IOUs.