Treasury bond rates auctioned Tuesday proved lower compared to prevailing rates in the secondary market, underscoring the market’s outlook for longer-term interest rates.
The Bangko Sentral ng Pilipinas continued to signal monetary policy easing but opted to wait for more inflation cues.
Headline inflation rose to 4.4 percent in July after easing to 3.7 percent in June. Core inflation that excludes selected food and energy items, slowed to 2.9 percent in July 2024 from 3.1 percent in June and the 6.7 percent posted in July last year, an indication that inflation would head to a slower path once food and energy prices stabilize.
Yield on the 7-year T- bonds, with a remaining term of 4 years and 9 months, averaged 6.107 percent after the auction.
Total bids reached P73.1 billion, allowing the Bureau of the Treasury to award the entire P30 billion at auction. This brings the total outstanding volume for the series to P189.7 billion.
The easing of yields in longer-dated debt papers contrasted sharply against the average rates on Treasury bills which rose at Monday’s auction as the market continued to await a clearer signal from the BSP on when it would ease monetary policy.
