Short-term benchmark interest rates dip

Published January 3, 2022, 2:50 PM

by Chino S. Leyco

Short-term benchmark interest rates dipped as investors anticipated slower inflation following the implementation of fuel price rollbacks in December, the Bureau of the Treasury said on Monday, Jan. 3.

The yield on three-month papers, which banks use in pricing their loans, eased to 1.075 percent from the 1.125 percent fetched during the last auction of 2021.

The government accepted P5 billion of the total tenders as despite demand for the 91-day Treasury bills reaching P24.144 billion during Monday’s auction of the debt papers.

Yield on the 182-day T-bill also eased to 1.269 percent from the previous 1.428 percent as investors were willing to buy P24.32 billion of the six-month IOUs. The government only accepted P5 billion.

Moreover, interest rates on the 364-day debt notes declined to 1.600 percent from the previous 1.649 percent with total tenders amounting to P22.589 billion, P5 billion of which were accepted by the government.

“Made full award on all tenors with rates dropping with inflation for December expected at 3.9 percent primarily on implementation of oil price rollbacks,” National Treasurer Rosalia V. De Leon told reporters.