THE market’s rate cut bets helped in the accouchement of low yields of Treasury bonds (T-bonds) in Tuesday’s auction, allowing the Bureau of the Treasury (BTr) to raise P30 billion. With a remaining term of seven years and seven months, the government securities’ average yield settled at 5.973 percent.
THE market’s rate cut bets helped in the accouchement of low yields of Treasury bonds in Tuesday’s auction, allowing the Bureau of the Treasury to raise P30 billion.
Investors asking yields were as low as 5.900 percent to a high of 5.984 percent. The coupon rate for the debt papers was set at 6.750 percent. Central bank Governor Eli M. Remolona Jr. signaled that a rate cut is on the table in the meeting of the Monetary Board this February 13, as the economy continues to underperform.
“Today’s inflation well-within the policy target band while 2024 GDP growth turned out weaker than expected at 5.6 percent,” Chutchotitham wrote. He noted that Remolona commented that the economy is “growing a bit below capacity” after, in line with the BSP’s “Q4 2024 Monetary Policy Report,” which assessed that the output gap would remain negative in 2025 and close by 2026.
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