Muted response to P30bn debt offer puzzles BoB

Parliament doubled the domestic debt issuance programme to P30 billion last September, but since then the monthly auctions of bonds by the BoB on behalf of government have produced consistently below par results.

Government borrows from the local capital market through the monthly auction of bonds and short term Treasury Bills (TB) and this year, with depleted reserves, is relying more heavily on the debt issuance programme to support the expected P6 billion budget deficit.