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By Chino S. Leyco Reporter
THE government again failed to
secure one-year borrowings through its regular auction of Treasury
bills with that maturity, as banks kept on asking for higher yields
in light of rising prices.
At Monday’s auction, the Bureau
of Treasury rejected lenders’ bids for a 6.986-percent return on
the one-year T-bill. This is higher than the 5.993-percent yield
sought in a previous auction. The bureau intended to borrow P6
billion, but local banks were only willing to buy P3.15 billion.
“It appears there is no
interest, so, these are bids that we think unacceptable. I guess
they’re still on the sidelines, the US FOMC is going to meet this
week also, they [are] also going to find out what the decision would
be,” Finance Undersecretary Roberto Tan said, referring to the US
Federal Open Market Committee, which is scheduled to meet and decide
on whether to cut interest rates further.
The acting national treasurer
said the market right now is more interested in the Bangko Sentral
ng Pilipinas’ (BSP) special deposit accounts (SDA) in light of the
upcoming US Fed decision.
“We’re not expecting the
rates will go down. But right now the market [has yet to] settle in
terms of inflation outlook [and] US interest rates,” he said.
Omar Cruz, a former national
treasurer, said investors are concerned about inflation.
“It will depend on how April
[and] May inflation is. If April or May inflation shows a further
increase, that’s going to elicit almost the same kind of reaction
as in March,” he said.
The government will come up with
the April inflation figure on May 5.
The National Statistics Office (NSO)
earlier said prices of goods and services in March rose at their
fastest pace in 20 months owing to higher food and fuel prices. At
6.4 percent, last month’s inflation rate breached the BSP forecast
of between 5.3 percent and 5.9 percent.
Acting Socioeconomic Planning
Secretary Augusto Santos said the upward pressure on inflation is
likely to continue in the next few months as local rice prices
reflect global supply conditions.
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