PH Treasury bill rates dip on Covid-19 fears, rate cut hopes

Philippine Treasury bill rates declined across the board on Monday, driven by concerns over the COVID-19 outbreak and anticipation of further monetary easing by the Bangko Sentral ng Pilipinas (BSP).

The average yield for the 91-day T-bill decreased to 3.072 percent from 3.115 percent, with bids significantly exceeding the government's offer.

Similarly, the rate for the 182-day T-bill averaged 3.420 percent, down from 3.461 percent, also witnessing strong investor demand.

The 364-day T-bill saw its average rate fall to 3.836 percent from 3.908 percent, attracting bids that were nearly six times the P8-billion offering.

National Treasurer Rosalia de Leon cited COVID-19 anxieties and expectations of a BSP rate cut in the second quarter as key factors influencing the declining rates.

The rate of the Philippines 10-year Treasury bond (T-bond) also fell Tuesday due to strong demand, with average rate declining to 4.409 percent from 4.617 percent fetched in November 2019.

Total tenders for the 10-year T-bond reached PHP83.589 billion, nearly thrice the PHP30-billion offer, prompting the acceptance of an additional PHP15-billion demand.

De Leon attributed the drop in rates to coronavirus disease 2019 (Covid-19) concerns and anticipation for another slash in the BSP's key policy rates after the first 25-basis-point reduction in February.