BOND RATE. The rate of three-year Treasury bond (T-bond) rises on Wednesday (May 4, 2022), tracking earlier outcomes of debt securities auctions. Authorities have traced this development to the expected policy rate hikes both in the Philippines and the US this year given the acceleration of inflation rate. (Photo grabbed from BTr Facebook page)
MANILA — The rate of three-year Treasury bond (T-bond) increased on Wednesday in line with recent jumps in debt paper yields given the expected aggressive hikes in the Federal Reserve’s key rates.
The average rate of the debt paper increased to 4.598 percent from 4.210 percent in the previous auction.
The Bureau of the Treasury (BTr) offered the paper for PHP35 billion, which the auction committee fully awarded. Total bids amounted to PHP41.492 billion.
National Treasurer Rosalia de Leon earlier said the rate upticks are seen given the expected increases in both the Bangko Sentral ng Pilipinas’ (BSP) and the Fed’s key rates this year as consumer price index (CPI) in the US continues to accelerate.
Markets expect the Fed’s key rates to be increased by around five times more this year following the 25 basis points hike last March, which is the first since December 2018.
To date, the Fed’s key rates are between 0.25-0.50 percent. (PNA)
