Domestic Bonds

Government keeps domestic P200-B borrowings for October – Manila Bulletin

The Treasury Office has maintained its domestic borrowing program at 200 billion pesos for next month.

Based on the Treasury notice of Wednesday, September 28, the Marcos administration’s October financing plan was unchanged from the September program.

The office said it will sell 60 billion pesos of treasury bills (T-bills) and 140 billion pesos of treasury bills (T-bonds) in October.

The Treasury will still hold a weekly auction for treasury bills and treasury bonds, offering 5 billion pesos of each 91, 182 and 364 day IOUs every Monday and issuing them on the 5th, 12th and October 19. , and 26.

In addition, the agency will issue 35 billion pesos worth of three-, six-, 10- and 13-year Treasury bonds on October 6, 13, 20 and 27, respectively.

The continued domestic borrowing program comes as the Treasury rejected all offers for 16-year Treasury bonds as investors seek higher yields to buy the securities.

If the bureau had accepted the offers, the interest rate on the debt securities maturing on January 24, 2036 would have reached 7.565%.

The average rate was higher than the 7,350% obtained in the secondary market, based on benchmark rates from the PHP Bloomberg Valuation (BVAL) service published on the Philippine Dealing System website.

The government was supposed to sell $35 billion worth of debt securities. Investors, however, were ready to buy 49.985 billion pesos.

Earlier, Finance Secretary Benjamin E. Diokno said the government would continue to borrow primarily from domestic debt markets under the Marcos administration.

For 2022, the government aims to raise 2.2 trillion pesos to enable strong and resilient growth in the economy, Diokno said.

“The Marcos administration plans to continue this borrowing mix by securing 75% or about 1.65 trillion pesos from domestic markets to insulate the country from currency volatility due to continued global uncertainties,” Diokno said.

In the first half of 2022, the government has already raised around 741 billion pesos.