The Bureau of the Treasury (BTr) partially awarded on Tuesday the five-year Treasury bond after investors asked for high yield.
The BTr offered the debt paper for PHP35 billion but the auction committee awarded PHP22.126 billion from total tenders of PHP58.277 billion.
The average rate of debt securities rose to 4.012 percent from 3.762 percent.
In a Viber message to journalists, National Treasurer Rosalia de Leon said the highest submitted bid during the auction was 4.15 percent.
This level, she said, “is way above fair value for the security.”
“Inflation will trend downward and BSP (Bangko Sentral ng Pilipinas) (is) patiently supportive to allow (the) economy to revive,” she said.
The inflation rate last December decelerated for the fourth consecutive month to 3.5 percent from month-ago’s 4.2 percent.
The average inflation last year stood at 4.5 percent, above the government’s 2-4 percent target band.
Monetary authorities forecast inflation to settle within-target levels this year.
The International Monetary Fund (IMF) has warned that emerging economies (EMs) may experience currency depreciation and capital outflows if ever the Federal Reserve implements faster monetary policy rate tightening.
De Leon said that “even without IMF warning, (we) have been mindful of Fed actions.”
“But of course we take comfort in (BSP) Gov(ernor) (Benjamin Diokno’s) statement (of) being patiently accommodative to support the (economic) recovery,” she added.
Source: Philippines News Agency