MANILA, Philippines — The Marcos administration was able to raise its planned amount of longer-dated local debts during Wednesday’s dual-tranche sale of Treasury bonds (T-bonds).
This was despite mixed movements of rates as investors remained cautious amid extreme global uncertainties.
Auction results showed the Bureau of the Treasury (BTr) borrowed a total of P40 billion via three-year and 20-year T-bonds.
The BTr awarded P15 billion in three-year T-bonds. The offering attracted total bids amounting to P63.9 billion, 4.3 times bigger than the original size of the issuance.
That said, the debt paper fetched an average rate of 5.703 percent, lower than the 5.779 percent seen in the previous auction of three-year T-bonds nearly two months ago. (See table)
20-year offering
Meanwhile, the government borrowed P25 billion via 20-year T-bonds. Total tenders amounted to P27.9 billion, beating the original size of the offering by 1.1 times.
Golden Goose is here in Manila
The debt securities were awarded at an average rate of 6.486 percent, higher than the 6.250 percent in the secondary market.
Michael Ricafort, chief economist at Rizal Commercial Banking Corp., said the lower yield for the three-year T-bond was due to the softer inflation print in April.
Meanwhile, the higher rate sought by creditors for the 20-year debt note was due to a somewhat tight liquidity condition following the mammoth T-bond sale last month.
Lingering uncertainties
John Paolo Rivera, a senior research fellow at state-run think tank Philippine Institute for Development Studies, said the market remained cautious amid the lingering global trade uncertainties.
“Today’s auction reflects a cautious market leaning toward shorter tenors, amid expectations of easing but lingering global and local uncertainties,” Rivera said.
“The strong demand for three-year bonds is consistent with a defensive positioning by investors, while the higher rate on the 20-year reflects premium demand for long-term risk compensation,” Rivera said.
