Peso GS Weekly: Borrowing cuts versus currency pressure

What happened last week

At the start of last week, local yields opened 2–3 basis points (bps) higher in sympathy with the global bond sell-off. This is particularly obvious in the belly of the curve, with 7-year and 10-year bonds testing 5.86–5.96%. Opportunistic buyers, however, kept rates anchored within recent ranges, as demand stayed firm for short-term instruments. Treasury bill auctions remained a bright spot, with strong bid-to-cover ratios near 4 times and awarded yields falling by 6–8 bps, underscoring continued appetite for liquid front-end securities.

By mid-week, trading slowed ahead of the Bureau of the Treasury’s (BTr) dual-tranche auction, with most investors holding back from large positions. The 3-year bond was awarded at 5.605%, broadly in line with expectations, while th