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By Chino S. Leyco, Reporter
THE government on Monday failed to complete its
short-term borrowings for the year, as investors pushed up the rate
for the one-year debt paper.
At Monday’s auction, the Bureau of Treasury
accepted banks’ bid of 5.705 percent for P1.9 billion of 364-day
Treasury bills. The government had planned to borrow P6 billion
through the sale of the one-year IOUs.
“I guess it’s probably on inflation
expectations, liquidity is starting to dry up,” Finance
Undersecretary Roberto Tan, who also serves as the acting national
treasurer told reporters after the auction.
Despite the lower than programmed borrowing, Tan
said the government is just providing some liquidity to the market
and “following the secondary market trend.”
“We have P4.6 billion maturing this week,
mostly bonds,” he added.
Last week, the treasury bureau finally decided
to cancel auctions for the benchmark 91-and-182-days debt papers in
the second quarter of the year due to consistent failures amid high
rates.
Local traders said banks favor the Bangko
Sentral ng Pilipinas’ (BSP) special deposit accounts (SDA) because
these offered higher rates.
The central bank earlier shut down some of the
windows of its SDA, and trimmed the rates of the remaining ones. The
move was seen as an attempt to allow the government to resume
short-term borrowings through the regular T-bill auctions.
After the BSP’s move, the treasury bureau
still failed to secure short-term borrowings in the open market.
“[As for the] SDA, they would probably put it
back until they get firm policy direction especially from the
central bank,” Tan said.
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