The Bureau of the Treasury has fully rejected bids for the seven-year treasury bonds during the last auction of the year.
With a remaining term of six years and eight months, the reissued government securities fetched an average of 4.395 percent, with P52.3 billion in total tenders.
“We find that there is more room for rates to decline following the deceleration in inflation and assurance from (Bangko Sentral ng Pilipinas) governor to hold rates steady,” Rosalia de Leon, national treasurer, told reporters via Viber.
“Market has not sufficiently priced in that inflation will be back within the target as supply disruptions are addressed,” she added.
Moving forward, de Leon said the market would also be looking at the Federal Reserve’s signal whether it will start early on rate liftoff and pace of taper.
“On the domestic front, will be watching the December inflation print and results of the Monetary Board policy meeting this Thursday,” she added.
According to de Leon, developments on the Omicron variant as well as efficacy of vaccines on the said variant will also be monitored.
“(In 2022), we are borrowing less and reducing domestic at 77% instead of 81% to make room for private sector with renewed lending following opening of economy,” de Leon said. – Angela Celis
