Yields on government debt end mostly lower amid ‘less dovish’ BSP guidance

YIELDS on government securities (GS) traded at the secondary market closed mostly lower last week in anticipation of the Bangko Sentral ng Pilipinas' (BSP) third straight rate cut, although its less dovish tone after the policy decision led to some profit taking before the weekend.

- Matthew Miguel L. Castillo

GS yields, which move opposite to prices, declined by an average of 3.57 basis points (bps) week on week, based on the PHP Bloomberg Valuation Service Reference Rates published on the Philippine Dealing System's website on Friday.

At the short end, yields ended lower across all tenors, with the 91-, 182-, and 364-day Treasury bills (T-bills) declining by 2.57 bps, 9.09 bps, and 6.28 bps week on week to fetch 5.2321%, 5.3921%, and 5.5357%, respectively.

At the belly, rates of the two-, three-, four-, five-, and seven-year Treasury bonds (T-bonds) likewise dropped by 5.42 bps (to 5.6198%), 5.11 bps (5.6908%), 4.22 bps (5.7526%), 3.34 bps (5.8095%), and 2.1 bps (5.9011%), respectively.

Meanwhile, the long end was mixed as yields on the 20-and 25-year debt dropped by 1.3 bps to 6.3384% and 1.41 bps to 6.3368%, respectively, while the rate of the 10-year tenor inched up by 1.6 bps to 6.016%.