The government secured P26.8 billion from a Treasury bond auction on Tuesday, drawing heavy demand for short-term debt but lukewarm interest in longer-term securities.
The Bureau of the Treasury (BTr) said the two-tranche auction showed a sharp contrast:
Investors piled into the reissued FXTN 07-64, a bond with 2 years and 7 months left to maturity. The P10 billion offering attracted nearly four times as many bids, reaching P37.9 billion. The average yield settled at 5.605 percent, lower than the previous auction, prompting the committee to make a full award.
Appetite for the long-term paper, however, waned. The Treasury offered P25 billion in the 20-year FXTN 20-27, but received tenders of only P25.7 billion, just enough to cover the offer.
The committee awarded only P16.8 billion at an average rate of 6.421 percent, also lower than before but still reflecting investor caution over extended maturities.
With Tuesday’s results, the outstanding volume of FXTN 07-64 rose to P361.4 billion, while the 20-27 bond increased to P229.6 billion.
