THE national government on Tuesday successfully raised P30 billion from the sale of long-term Treasury bonds (T-bonds) on the back of easing yields sought by investors.
The Bureau of the Treasury (BTr) made a full award of reissued 10-year T-bonds in an auction that reached P96.1 billion in total tenders, three times more than the programmed amount. The average rate for the government security, which has a remaining life of nine years and 10 months, stood at 6.227 percent.
The average auction yield was slightly lower compared to the 10-year PHP BVAL yield at 6.25 percent as of March 11, 2024.
However, it was slightly higher than the 6.218 percent in the previous auction for the debt paper with the same tenor auctioned last January 23, 2024.
The investors’ asking yields ranged from 6.198 percent to 6.240 percent, based on the Treasury’s data.
“With its decision, the committee raised the full program of P30.0 billion, bringing the total outstanding volume for the series to P65.0 billion,” said the Treasury in a statement after the auction.
The Treasury has made a full award of a T-bonds tender for the second straight week after generating P30 billion from the auction of T-bonds despite higher yields. Rizal Commercial Banking Corp. (RCBC) Chief Economist Michael L. Ricafort said the lower average auction yield is “still strong” with demands totaling P96.1 billion. The latter Ricafort considers as “still relatively high.”
The RCBC executive explained that the matured P700-billion retail treasury bonds (RTBs) from March 9 to March 12 could have added to liquidity in the financial markets. The latter is expected increase the demand and lower the yields for government securities, as these excess funds could be reinvested, Ricafort said.
This month, the national government plans to borrow as much as P120 billion from the tender of T-bonds. The programmed amount is P30 billion lower than the P150 billion targeted amount last month. It is also targeting to raise P180 billion in March from the combined sale of T-bonds and Treasury bills (T-bills). The Treasury will tender a total of P51.050 billion worth of T-bills and P1.802 trillion worth of T-bonds this year.
Based on state budget documents, the national government aims to borrow a total of P2.46 trillion, P253 billion higher than the P2.207 trillion gross borrowing plan in 2022.