HIGH YIELD. The appetite for long-tenor debt instruments results in the decline of the 10-year Treasury bond (T-bond) on Tuesday (July 19, 2022). National Treasurer Rosalia de Leon said investors took advantage of the high yield to lock in rates. 

MANILA – The appetite for long-tenors boosted demand for the 10-year Treasury bond (T-bond), which registered a lower rate on Tuesday. 
 
The average rate of the debt paper went down to 6.865 percent from 7.145 percent previously. 
 
The Bureau of the Treasury (BTr) offered the T-bond for PHP35 billion and the auction committee made a full award. Total bids reached PHP123.318 billion. 
 
National Treasurer Rosalia de Leon said “strong demand is an understatement in the auction.” 
 
“Appetite for long end (is) coming from good yield pick-up, especially for retirement funds to lock in high rates,” she told journalists on Tuesday. 
 
This, as rates are expected to rise further as central banks help address the accelerating rate of price increases. 
 
The rate of the debt paper during the auction is lower than in the secondary market. 
 
Asked if issuance of long-term debt instruments will be a major consideration in the government’s capital raising activities given the current situation, de Leon said: “(We are) inclined to always stretch maturity subject to reasonable rate.” (PNA)