Yields go down on surprise cut

YIELDS on government securities (GS) ended mostly lower last week after the Bangko Sentral ng Pilipinas (BSP) surprised the market by delivering a fourth consecutive rate cut.

- 

GS yields, which move opposite to prices, declined by an average of 5.32 basis points (bps) week on week, according to PHP Bloomberg Valuation Reference Rates data as of Oct. 10 published on the Philippine Dealing System's website.

Rates at the short end were mixed as the 91and 182-day Treasury bills (T-bill) rose by 5.53 bps and 2.15 bps week on week to end at 4.9706% and 5.198%, respectively, while the 364-day T-bill fell by 4.76 bps to yield 5.2786%.

Meanwhile, yields at the belly and the long end went down across all tenors. The two-, three-, four-, five-, and seven-year Treasury bonds (T-bonds) dropped by 6.86 bps (to 5.5079%), 9.27 bps (5.6009%), 10.33 bps (5.6832%), 10.75 bps (to 5.7536%), and 10.78 bps (5.8455%), respectively.

Yields on the 10-, 20-, and 25-year bonds also declined by 6.67 bps (to 5.9556%), 2.95 bps (6.4102%), and 3.78 bps (6.4008%), respectively.

Total GS volume traded amounted to P148.2 billion on Friday, jumping from the previous week's P24.28 billion.