The looming increase in the Bangko Sentral ng Pilipinas’ (BSP) policy rates caused the Philippines' benchmark borrowings yields to rise, prompting the Bureau of the Treasury to reject all tenders.

At the Treasury bureau’s auction on Monday, May 16, the national government failed to raise P15 billion through the sale of 91-, 182-, and 364-day IOUs after investors sought higher returns for buying those securities.

Had the bureau accepted the tenders, the interest rate on the three-month Treasury bill (T-bill) would have risen to 1.759 percent from 1.531 percent last week.

The government was supposed to sell P5 billion worth of the debt papers. Investors however were willing to buy more, as tenders reached P13.304 billion.

Meanwhile, the 182-day T-bill would have fetched an average rate of 2.215 percent, up from 1.500 percent when the same IOU was successfully auctioned off last May 2.

Total tenders for the six-month securities amounted to P7.327 billion, higher than the programmed P5 billion.

Lastly, the average rate of the 364-day T-bill would have gone up to 2.828 percent from 1.933 percent during the last successful auction of the one-year IOU last May 2.

The bureau had planned to borrow P5 billion, but total tenders reached only P2.9 billion.

“The market remains defensive and bracing for possible rate hike by the Monetary Board with stronger than expected first quarter GDP growth,” National Treasurer Rosalia V. De Leon told reporters after the auction.