The Bureau of the Treasury (BTr) awarded the entire reissued five-year treasury bonds on Tuesday, raising P30 billion as programmed.
The auction was 1.8 times oversubscribed, with total tenders reaching P55.2 billion.
The BTr raised the full program, bringing the total outstanding volume for the series to P291.7 billion.
With a remaining term of five years and two months, the securities fetched an average yield of 5.943 percent.
The prevailing Bloomberg Valuation Service rate is 5.921 percent for the five-year tenor.
John Paolo Rivera, a senior research fellow at the Philippine Institute for Development Studies, said the relatively weaker demand for the treasury bonds, as compared to the previous offers where there were two or three times oversubscription, could partly be attributed to investor fatigue following the large issuance of 10-year Treasury notes earlier this month.
“Some investors may also be adopting a more cautious stance amid ongoing global interest rate uncertainty and domestic inflation risks, leading them to become more selective with tenor exposures,” Rivera said.
Michael Ricafort, Rizal Commercial Banking Corp. chief economist, also mentioned the recent P300 billion 10-year local Treasury note issuance, which siphoned off some of the excess peso liquidity from the financial system, affecting the Treasury bond auction performance.
He added that the markets were still waiting for information on any inflationary impact of US President Donald Trump’s higher import tariffs, which could determine the pace of future Fed rate cuts.
