September 25, 2023

The Bureau of the Treasury (BTr) partially awarded the fresh offering of the three-year Treasury bond (T-bond) after its interest rate rose.
The coupon rate of the debt paper stood at 4.250 percent while its average rate ended at 4.210 percent, higher than the 2.279 percent in the previous issuance.
The BTr offered the debt securities for P35 billion, but the auction committee awarded P25.791B. Total bids reached P53.578B.
“Market remains defensive with four percent inflation print for March and (Bangko Sentral ng Pilipinas) Gov. (Benjamin) Diokno statement on BSP rate action in the second half,” National Treasurer Rosalia de Leon said.
The Philippine Statistics Authority reported earlier in the day a rise in the rate of price increases to four percent in March from last February’s three percent, with the uptick traced to oil price hikes in the international market and their impact on the domestic oil and commodity prices.
The average inflation in the first quarter this year stood at 3.4 percent, within the government’s 2-4 percent target band.
Diokno said while average inflation this year is forecast to surpass the target band at 4.3 percent, it is projected to average at 3.6 percent next year.
Aside from the rise in the domestic inflation rate, he said inflation expectations followed the same path.
Diokno said the impact of Russia’s invasion of Ukraine will be felt directly in the Philippines through higher oil prices, but its other effects include a threat to global economic expansion, which will also affect the domestic economy.
“Under these circumstances, the BSP will closely monitor the emerging risks to the outlook for inflation and growth, and remain vigilant against possible second-round effects from supply-side pressures or any shifts in the public’s inflation expectations,” he added. – PNA