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Peso GS Weekly: Buying at the belly
Market players stay opportunistic, as the curve steepens with short-term yields falling and long-term yields rising.
By Metrobank Local Currency Trading Department and Maria Christina Virtudazo
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WHAT HAPPENED LAST WEEK
The local government securities (GS) market started last week by mirroring the global market sell-off, with both clients and dealers selling their bonds. Offshore players also de-risked, as the USD/PHP exchange rate surged to a new year-to-date high at 58.70.
Elsewhere, strong support remained in Treasury bills (T-bills), with new issuances awarded at average rates that were 4 to 27 basis points (bps) lower week-on-week. The strong demand allowed the Bureau of the Treasury (BTr) to increase the awards in 3- and 6-month T-bills to PHP 9.8 billion from the initial PHP 7 billion announced.
Last Tuesday, the BTr fully awarded the reissuance of the 7-Year Fixed Rate Treasury Note 10-69 within market indications at an average rate of 6.249% and a high of 6.290%. However,