National Treasurer Rosalia de Leon (BTr photo)
MANILA – Bureau of the Treasury (BTr) partially awarded on Tuesday the three-year Treasury bond (T-bond) after investors asked for high rates.
The average rate of the debt paper rose to 4.994 percent from 4.598 percent previously.
BTr offered the T-bond for PHP35 billion but the auction committee awarded PHP9.305 billion. Total tenders reached PHP56.926 billion.
National Treasurer Rosalia de Leon said the auction committee “saw good bid to cover but market remained defensive with inflation expected to breach beyond 5 percent per Bloomberg estimate”.
“Bids also took cue that Fed (Federal Reserve) will (deliver) another 50 bps hike and guidance from (Bangko Sentral ng Pilipinas) Gov. (Benjamin) Diokno for another 25 BPS (basis points) rate lift this June,” she added.
For one, the Fed’s key rates have been hiked by a total of 75 BPS since March to help tame US’ heating inflation rate, which posted its four-decade high since January.
Relatively, the accelerating inflation rate is also among the reasons for the 25 BPS increase in the BSP’s key rates this month, the first since December 2018 and after the total of 200 BPS reduction in 2020.
Diokno earlier said another 25 BPS hike is being considered for the rate-setting meeting of the BSP’s Monetary Board in June as despite the expected rise in the domestic inflation rate, the domestic economy’s recovery continues. (PNA)
