The average interest or yield on the reissued 20-year treasury bonds slipped by 6.9 basis points to 5.035 percent, with investors tendering a total of P31.08 billion, more than twice the government’s offer of P15 billion.
The Bureau of the Treasury, which fully awarded the treasury bonds on account of strong demand for the security, said in a statement that the bonds were re-issued at an average interest rate “within internal estimates.”
In an interview with reporters, National Treasurer Rosalia de Leon said the auction was “very good,” adding that the “very healthy demand” for the bonds signified the return of investor appetite on the long end of the curve.
“Appetite on the long end (of the curve) is coming back after the (Bangko Sentral ng Pilipinas) BSP held rates steady. And then of course the rollback of oil prices. Inflation expectations are low,” she said.
Investors’ appetite also manifested during last week’s auction of treasury bills as the issue was oversubscribed by around three times, which De Leon described as “very healthy.”
The national treasurer attributed this to buyers’ possible consideration of BSP outgoing Gov. Amando Tetangco Jr.’s statement on domestic conditions rather than global developments playing a bigger factor.
De Leon also said that the Treasury had released the borrowing program for the third quarter, keeping the frequency, tenor and amount the same as that in the second quarter.
“We’re building up the volume of those bonds so basically we’ll be re-issuing again along those tenors also,” she said. —FRANCES JOSEPHINE E. ESPESO