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Thursday, March 28, 2024

Govt hikes first-quarter borrowing cap to P180b

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The government increased the domestic borrowing cap for the first quarter of 2017 to P180 billion to support the growth in public expenditures.

The Bureau of Treasury said in a notice posted in its web site it adjusted the borrowing ceiling for the first quarter to P180 billion from P135 billion.

National Treasurer Tan said in a text message the increase in the overall volume was in lieu of the anticipated rise in expenditure growth in the coming years to support government infrastructure and social programs. 

“Even this year, we have observed a marked improvement of the disbursement rate for these programs and expect such to continue. With a larger budget and a wider deficit next year, we are adjusting our periodic borrowing requirement accordingly,” Tan said.

The borrowings will be coursed through the auction of treasury bills and bonds in January to March 2017 to finance next year’s budget deficit target of 3 percent of the economy or P478.1 billion.

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The government plans to sell 91-, 182-, and 364-day debt papers on Jan. 18, Feb. 1, Feb. 15, Mar 1, Mar 15, and Mar 29. 

The Treasury, however, decreased its cap for long-term debt papers per auction to P15 billion from the previous volume of P25 billion. It will sell the treasury bonds though auctions on Jan. 12 and 26, Feb. 9 and 23, and Mar 9 and 23. 

“On the frequency and volume of the weekly auctions, we have decided that more auctions with smaller volumes would be the appropriate program for the period,” Tan said.

“This is in response to ongoing market uncertainly and after consultation with our government securities dealers,  which indicated preference for the announced auction program for 2017 Q1,” he said.

The inter-agency Development Budget Coordination Committee recently announced that it would have a borrowing mix of 80:20 ratio, with bias towards local creditors for 2017.

The Duterte administration, in its 2017 budget, announced plans to borrow P631.289 billion. Broken down, P505.03 will be from the domestic market while the remaining P126.259 will come from offshore borrowings.

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