Five-Year T-Bond rate drops on strong demand

The average rate of the five-year Treasury bond (T-bond) fell to 5.772 percent during Tuesday’s auction, down from 5.896 percent in the July 1 issuance, the Bureau of the Treasury (BTr) reported.

Despite the lower rate, the BTr’s auction committee made a full award of P30 billion as bids reached P79.67 billion—more than twice the offer.

Rizal Commercial Banking Corporation chief economist Michael Ricafort attributed the strong demand to the BTr’s earlier announcement that it would no longer issue major debt offerings this year, such as retail treasury bonds (RTBs) or long-term treasury notes. The government already raised P507.16 billion from RTBs in August.

Ricafort added that the recent 25-basis-point policy rate cut by the Bangko Sentral ng Pilipinas (BSP) also helped boost demand by lowering borrowing costs.such loan exists,” the DOF said in a statement.

The agency stressed that the PBBM Rural Modular Bridge Project loan, amounting to P28 billion, is being proposed for financing by France—not South Korea.

The DOF explained that the project was initially considered for Korean funding, but talks were halted last year by the Department of Agrarian Reform due to “non-alignment on scope and other key technical specifications.”

It added that since the last quarter of 2024, the government has been seeking alternative bilateral partners and is now in “advanced negotiations with the French Government to finalize the project’s technical and financial terms.”

“We reaffirm to our bilateral partners that the Philippine government will match their trust and confidence with full transparency and accountability,” the DOF said.