MANILA – The rate of the 10-year Philippine government-issued Treasury bond (T-bond) declined to 4.692 percent Tuesday, lower than its previous average, as well as the secondary market rate in the morning session.
The debt paper’s average rate fell from the 4.759 percent it fetched during the auction by the Bureau of Treasury (BTr) last May 4.
It is also lower compared to the secondary market rate for the same tenor in the morning session at 4.9714 percent.
National Treasurer Rosalia de Leon said demand for the debt paper is “strong”, citing the P29.491-billion tenders, nearly double the P15-billion offering.
The auction committee made a full award for this tenor.
De Leon said the bulk of the appetite came from institutional investors, such as insurance companies.
She said the normalization of the US interest rate, with markets expecting another hike from the Federal Reserve after the Federal Open Market Committee (FOMC) meeting this week, is not seen to affect demand for longer-tenor debt instruments.
“Even if there is a strong expectation on the Fed rate hike, we still see that the inflation environment right now is very benign,” she said, citing the 3.1 percent average inflation rate in the first five months of 2017.
