The government completed a dual‑tenor Treasury bond auction on Tuesday, achieving a full award as demand for risk assets surged amid easing U.S.–Iran tensions and a drop in global oil prices.
The seven‑year reissued bonds, worth a program of P30 billion, attracted bids totaling P80.238 billion. They were awarded at an average yield of 7.217%, ranging from 7.00% to 7.24%. This rate is 63.7 basis points above the 6.58% yield obtained in the previous auction on June 30 and 21.7 basis points higher than the 7% coupon.
The twenty‑year bonds, with a program of P10 billion, drew bids of P44.968 billion, roughly four times the issue size. They received an average yield of 7.684%, with accepted rates between 7.60% and 7.798%. The yield dropped 2.1 basis points from the 7.705% obtained in May and remains 80.9 basis points above the 6.875% coupon.
Analysts noted that the stronger demand was driven by lower yields following a decline in oil prices and a temporary pause in hostilities in the Middle East, which improved risk appetite and eased inflation concerns.
In July, the Treasury raised a total of P455.071 billion from the domestic market, comprising P330 billion in Treasury bills and P125.071 billion in bonds. This figure exceeded the planned P410 billion program despite a single bond offer that received no bids, and the Treasury also issued cash‑management bills twice during the month.
For August, the Treasury intends to raise P330 billion, split between P200 billion in bills and P130 billion in bonds, as it continues to borrow locally and abroad to finance a budget deficit capped at P1.659 trillion, or 5.4% of GDP.
