By Aaron Michael C. Sy, A reporter
The GOVERNMENT has increased the price above the planned price Treasury bills (T-bills) on Mondayin the day’s auction as strong demand for short-term securities pushed down yields, with investors bracing for a weaker-than-expected economy ahead of the Bangko Sentral ng Pilipinas’ (BSP) policy meeting later this month.
The Bureau of the Treasury (BTr) awarded P37.8 billion of T-bills, surpassing the P27-billion offered after bids rose to P176.8 billion from P156 billion in last week’s auction.
In response to this high demand, the Auction Committee has doubled the acceptance of non-competitive bids in all tenders to P7.2 billion each, the Treasury said in a statement. Average yields for all matured crops fell from last week’s auction to below secondary market levels.
The Department of Finance awarded P12.6 billion in T-day-91 loans, above the P9-billion program, as bids totaled P62.1 billion. The three-month paper fetched an average rate of 4.579%, down 8.7 basis points (bps) from 4.666%. The yield received was 4.548% to 4.593%.
With a tenor of 182 days, the government also borrowed P12.6 billion, exceeding the planned P9 billion, with tenders reaching P59.818 billion. The average yield decreased by 7.9 bps to 4.672% from last week. Accepted rates ranged from 4.63% to 4.7%.
The Department of Finance also raised P12.6 billion in 364-day T-Bills, up from P9-billion, as bids reached P54.89 billion. The average one-year paper yield fell by 13.8 bps to 4.689%, with the acceptable range of 4.67% to 4.735%.
Before the auction, secondary market rates stood at 4.6826% for 91 days, 4.7725% for 182 days and 4.8412% for 364-day bills, based on reference data from the PHP Bloomberg service provided by the Ministry of Finance.
“T-bill auctions continued to enjoy strong demand, supported by the outlook for slower growth and favorable inflation conditions,” the trader said in a message. “These conditions are already difficultfis willing to put downward pressure on yields.”
Economic growth in the Philippines slowed to 3% in the fourth quarter of 2025 from 5.3% last year and 3.9% in the third quarter. Full-year growth reached 4.4%, below the government’s target of 5.5% to 6.5%.
“Although a rate cut by the BSP is still possible, the macroeconomic situation allows the central bank to remain dependent on data, and the scope to change the currency through the use of resources and setting the settings for the next meeting rather than rushing to reduce policy,” said the trader.
Analysts say weak growth data could raise expectations for more policy cuts to support domestic demand. BSP Governor Eli M. Remolona, Jr. he said a rate cut this month is not guaranteed, noting that slow growth alone will not justify the rate cut as inflation is still the main focus of the central bank.
The Board of Finance is scheduled to meet on February 19.
Another trader said the strong demand was driven by a large number of maturities due next week, prompting investors to reinvest in government securities.
On Tuesday, the government will auction P30 billion of seven-year Treasury bonds with maturities of four years and eleven months.
The government plans to raise P308 billion in the domestic market this month, including P108 billion in T-bills and P200 billion in Treasury bonds, to help finance a budget deficit of P1.647 trillion, or 5.3% of this year’s gross domestic product.
