THE Bureau of the Treasury raised an additional P20 billion in 3-year Treasury bonds (T-bonds) during its tap facility auction on Tuesday.
This is on top of the P30 billion worth of T-bonds it also awarded on the same day.
Tenders during the tap facility auction reached P46.893 billion, more than twice the P20-billion offering.
The tap facility auction was open to all 11 government securities dealers-market makers.
The average auction rate for the tenor at 2.558 percent was lower than the previous auction and the prevailing secondary market rates, as well as the original 3.5-percent coupon rate.
With a remaining life of 2 years and 10 months, the 3-year T-bonds mature on April 21, 2023.
For this week, the Treasury sold a total of P88 billion in debt papers. Of which, P38 billion was raised through auctioning off Treasury bills, while the remaining P50 billion was raised via T-bond sale.
For this month, the Treasury aims to borrow P170 billion from the local debt market, the same level it programmed to borrow last month.
Prior to Covid-19, the government had set a P1.4-trillion borrowing program this year.
While the government has yet to firm up the revised borrowing program for this year, the Cabinet-level Development Budget Coordination Committee (DBCC) expects a wider budget deficit this year at 8.4 percent of GDP or equivalent to P1.613 trillion.
Meanwhile, the country’s debt-to-GDP ratio is projected by the government to increase to 49.8 percent this year from 39.6 percent last year.
For 2021 and 2022, the DBCC sees an even higher debt-to-GDP ratio of 51.5 percent and 52.3 percent, respectively.
Despite the projected increase in the country’s debt-to-GDP ratio, economic managers had said this is still far lower than the most recent peak of 71.6 percent in 2004.
A budget deficit occurs when expenditures exceed revenues, while debt-to-GDP ratio is used to gauge a country’s ability to pay off its debt.