The Philippine Bureau of the Treasury (BTr) plans to issue a significantly smaller volume of retail treasury bonds (RTBs) this year, with National Treasurer Sharon Almanza indicating a reduction of more than half compared to last year's issuance. This decision is driven by the government's exploration of alternative funding options and the nearing completion of its domestic borrowing requirements for the year. The government aims to borrow $2.73 trillion this year, with $1.92 trillion from the domestic market and $815.51 billion from external sources.
Almanza noted that the government does not require a larger volume from the RTB sale due to its current financial position and upcoming auctions for the remainder of the year. The proceeds from this issuance will be allocated for general government support. While the exact size and interest rate of the upcoming RTB issuance were not disclosed, Almanza highlighted that it marks the 25th anniversary of RTBs, promoting them as an accessible investment instrument for retail investors.
The previous RTB offering in August 2025 successfully raised $507.16 billion. The BTr is also considering other funding avenues, including a retail dollar bond, an earlier issuance of which is set to mature in October. Almanza expressed concerns about potential upside risks to interest rates, citing expectations of higher inflation in September due to the impact of the southwest monsoon, El Niño, and recent increases in oil prices. These factors could lead to a rate hike and consequently push bond yields higher.
