MANILA, Philippines — The domestic debt market demanded lower rates for long-term securities, allowing the government to raise its entire borrowing program at P25 billion.
The Bureau of the Treasury yesterday fully awarded P25 billion for the reissued 25-year T-bonds on offer with a remaining life of 12 years and six months.
The 13-year T-bonds fetched an average rate of 6.167 percent, down by 9.5 basis points from the 6.262 percent BVAL Reference Rate, which is the standard for securities.
Rates went from a low of 6.05 percent and a high of just 6.2 percent.
Lower investor asking rates are still an aftermath of inflation cooling, albeit slightly, to 8.6 percent in February from a 14-year high of 8.7 percent the month before.
Yesterday’s average rate was significantly lower than the eight percent coupon rate when the T-bonds were first issued in September 2010.
The last reissuance on Jan. 31 also saw rates slightly pick up to 6.197 percent but the Treasury still raised its intended P35 billion program.
Demand for the securities attracted P54.045 billion, oversubscribing the auction by 2.16 times.
Bids dipped by 32 percent during the last 13-year auction where offers reached P79 billion.
The latest offering has a maturity date of Sept. 30, 2035.
The government’s borrowing program for March is at P200 billion, of which P125 billion is targeted to be raised from long term T-bonds. The Treasury has so far awarded P75 billion.