At the beginning of the week, local bonds opened quietly with yields marginally higher, as profit-taking emerged amid a lack of fresh catalysts. T-bill auctions drew strong demand, with bid-to-cover ratios more than four times and average yields falling by up to 4 basis points.
Mid-week, sentiment shifted after the Bureau of the Treasury’s final bond auction of the year saw robust demand. The 3-year FXTN 7-64 and 10-year FXTN 10-73 were awarded near the lower end of expectations, triggering a rally that pushed yields down by 1–3 basis points across the curve.
Buying momentum persisted at the end of the week, with yields dropping another 3–7.5 basis points, led by the belly of the curve. The recently reissued FXTN 10-73 outperformed, falling to 5.80%, while the curve bull-steepened as demand concentrated in the 3- to 5-year space.
This week, market players’ focus turns to the Bangko Sentral ng Pilipinas (BSP) policy meeting this week. This follows data showing headline inflation at 1.5% in November—below market consensus of 1.7% and Metrobank’s 1.8% forecast. The softer inflation reinforces expectations of a rate cut. With liquidity ample and no supply pressure, yields are likely to drift lower, and any selloffs should remain shallow.
Note: Rates are indicative and subject to refresh.
For more information on Peso Government Securities, you may reach out to your investment specialist or log on to Metrobank Wealth Manager. We offer lower fees of 0.050% for every successful buy or sell transaction placed on Wealth Manager until December 31, 2025.
JANSSEN ROMAN is an Investment Counselor at Metrobank, under the Institutional Investors Coverage Division. His expertise was built upon his previous roles as an Investment Specialist and Financial Markets Sector Management Trainee within Metrobank. He is pursuing his Master of Arts in Economics from Ateneo de Manila University and has earned other certifications and licenses from various regulators and educational institutions. Outside work, he dabbles in photography, travel, and motorcycle riding.
