Gov’t to increase November borrowings to P215B

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The national government plans to borrow next month from domestic lenders a total of P215 billion through Treasury bonds (T-bonds) and bills (T-bills), higher than the P200-billion monthly goal in September and October as the calendar provides an extra auction day for T-bills.

Next month’s program slates five auctions of T-bills with the three tenors at P5 billion each or P15 billion per batch, for a total offer of P75 billion.

The Bureau of the Treasury (BTr) will also offer P35 billion each for T-bonds that expire in 3.5 years, 5.5 years, seven years and 10 years—for a total of P140 billion.

Data from the BTr show that in the eight months to August, there were a total of P529.06 billion in outstanding T-bills and P8.41 trillion in outstanding T-bonds.

The T-bonds include P3.9 trillion worth of regular issues with tenors of 3 years to 28.5 years as well as P4.51 trillion in special issues.

The specials include, among others, P3.25 trillion worth of retail T-bonds (three to 25 years), P1.09 trillion in benchmark bonds, P28.09 billion in onshore US dollar-denominated bonds, and P89.5 billion in US dollar retail T-bonds.

In their latest monthly report, First Metro and UA&P Capital Markets Research said that with the Philippines’ inflation hitting a 13-year high of 6.9 percent in September and the United States Federal Reserve expected to continue raising their federal funds rate, the Bangko Sentral ng Pilipinas might raise its own policy rate by 0.75 percentage point in November.

“While we see a further increase in bond yields in early fourth quarter [2022], it would likely ease up towards the end of the year and into the first quarter of 2023,” they said.

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