THE Bureau of the Treasury (BTr) fully awarded P35 billion in reissued P10-year Treasury Bonds (T-Bonds) on Tuesday amid strong liquidity in the market.
The auction was more than twice oversubscribed as total submitted bids amounted to P84.24 billion.
With a remaining life of 9 years and 24 days, the debt paper is set to mature on July 9, 2030.
The security also fetched an average rate of 3.719 percent, down by 89.5 basis points from 4.614 percent in the previous auction.
National Treasurer Rosalia V. De Leon expressed satisfaction that the tenor attracted good rates.
“When it rains, it pours,” De Leon said adding that investor demand was also evident due to strong liquidity in the market.
“Liquidity from RTB (retail treasury bonds) redemptions looking for home,” she added.
Apart from the primary auction, the Treasury also decided to auction off an additional P10 billion in reissued 10-year T-bonds via tap facility.
For this month alone, the Treasury is aiming to borrow P215 billion from the local debt market, up by 26 percent compared to only P170 billion it programmed to borrow per month in April and May. The bulk of the programmed domestic borrowings for June, or P140 billion, is set to be raised through T-bonds with longer tenors while the rest of the amount is planned to be raised by auctioning off P75 billion in Treasury Bills.
For this year, the national government has set a P3.03-trillion gross borrowing program, roughly the same amount it borrowed in 2020.
The national government’s total outstanding debt continued to swell to a fresh record-high of P10.991 trillion in April this year as the country resorts to more borrowings to finance its pandemic response.
This was up by 2 percent from P10.77 trillion reported at the end of the year’s first quarter and it was also a 27.8 percent jump from P8.6 trillion of end-April last year.
Finance Secretary Carlos G. Dominguez III has also said they expect the country’s debt-to-GDP ratio this year to reach 58.7 percent.
This is below the 60 percent international threshold but higher than the country’s debt-to-GDP ratio last year at P54.5 percent.
The Cabinet-level Development Budget Coordination Committee also recently slashed its growth projection for the Philippine economy this year to 6 to 7 percent from its previous forecast range of 6.5 percent to 7.5 percent due to the emergence of new Covid-19 variants and the re-imposition of stricter lockdown measures in the National Capital Region Plus during the second quarter of this year.
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