BTR raises ₧35B from sale of reissued 10-yr T-bonds

DESPITE local rates tracking higher US Treasuries, the Bureau of the Treasury sold P35 billion in reissued 10-year Treasury Bonds (T-bonds). Total tenders reached P51.1 billion, making the auction nearly 1.5-times oversubscribed.

With 9 years and 11-months to maturity, T-bonds fetched an average rate of 5.093 percent, up by 26.2 basis points from previous auction’s 4.831 percent. According to National Treasurer Rosalia V. De Leon, the rate, while higher, was still within the secondary level.

The average rate was “marginally higher than secondary level as local rates track climb in US treasuries,” the Treasurer told reporters. She added the “market remain defensive with anticipated higher US CPI [consumer price index] print in [January] adding more pressure for Fed [US Federal Reserve] to act hawkishly.”

Based on Bloomberg’s survey of economists, the median projection for the US consumer price index jumped 7.3 percent in January from a year ago, the largest annual advance since early 1982 or four decades ago. Last year, US consumer prices jumped 7 percent, hitting 39-year-high since June 1982.

Traders and investors are vociferously betting the Fed would raise interest rates in March to contain inflation.

Philippine inflation, on the other hand, slowed to 3 percent in January from 3.7 percent in the same month last year, the Philippine Statistics Authority (PSA) reported last February 4.

For this month, the Bureau of the Treasury programmed to borrow a total of P200 billion from the local debt market, the same level it aimed to raise in January.

For this year, the national government programmed to borrow P2.47 trillion, down by nearly a fifth from P3.07 trillion programmed last year.

The national government’s outstanding debt as of end-2021 shrank to P11.73 trillion from P11.93 trillion in the previous month on the back of net redemption of government securities. However, the country’s debt-togross domestic product ratio soared to a 16-year-high of 60.5 percent. This ratio is also the highest since 65.7 percent in 2005.