T-bond rate rises ahead of price data

Bureau of the Treasury (From the Facebook account of the bureau)

MANILA, Philippines — The Marcos administration was able to raise its planned amount of long-dated debt securities on Tuesday’s sale of Treasury bonds (T-bonds) despite the higher rates sought by investors awaiting the latest inflation data.

The Bureau of the Treasury (BTr) made a full award of reissued T-bonds amounting to P30 billion, which have a remaining life of six years and nine months.

The offering was met with strong demand. Auction results showed total bids for the debt papers reached P40.25 billion, exceeding the original size of the issuance by 1.3 times.

READ: ‘Tempered’ rate cut hopes pushed up T-bond yields

But the strong appetite among local creditors did not stop interest rates from going up. The reissued T-bonds fetched an average yield of 6.299 percent, more expensive than the 6.27 percent recorded at the previous auction of comparable tenor on March 5.

The rate was also higher than 6.24 percent quoted for the same tenor in the secondary market as of April 1.

Michael Ricafort, chief economist at Rizal Commercial Banking Corp., said rates went up as investors awaited the March inflation data scheduled to be released on April 5.

Ricafort cited “expectations of possible uptick in the upcoming headline inflation data.” INQ