The Treasury partially grants 24 billion pesos in Treasury bonds

Louise Maureen Simeon – The Filipina Star

October 12, 2022 | 00:00

MANILA, Philippines — The government has only granted a portion of treasury bonds (T-bonds) as yields continue to climb as the local debt market adjusts to global developments.

The Treasury Office yesterday partially allotted an original seven-year Treasury bond issue worth 24.125 billion pesos out of the proposed 35 billion pesos.

This is the second week in a row that the Treasury has granted a partial allotment.

The coupon rate was set at seven percent, above the rate of 6.778 percent for the secondary markets.

T-bonds also averaged a return of 6.943% from a low of 6.625% and a high of 7.1%.

Meanwhile, the latest Treasury bond yield was also higher than the 6.588% yield at the last long-term government securities auction for a seven-year bond on September 20.

Demand for the securities attracted P54.105 billion, oversubscribing the auction by 1.55 times. Such demand is greater than the supply of Treasury bonds the previous week which reached only 39.144 billion pesos.

But it is slightly lower than the 54.844 billion pesos bids made in the last seven-year Treasury bond offering.

The partial decision continues to prove that the local debt market is still providing some sort of cushion amid still-rising inflation that hit a four-year high of 6.9% in September.

For October, the government aims to obtain 200 billion pesos from the domestic debt market. Of this amount, 140 billion pesos will come from long-term debt securities.

So far, the Treasury has raised 46.975 billion pesos.

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