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Thursday, March 28, 2024

Gov’t may continue borrowing from BSP

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Finance Secretary Carlos Dominguez III said Wednesday the government may borrow more from the Bangko Sentral ng Pilipinas next year to support the economic recovery.

Dominguez said in an interview over Bloomberg TV he was confident “our revenue flow can hold us a bit.”

“At the moment there is no need to do that… We are keeping the balance of credit line with the BSP in reserve. Our first option is to go back to the commercial markets,” Dominguez said.

“[But] if the economy does not perform well as we expected, we can go back to them,” he said.

The Bureau of the Treasury settled in full on Sept. 29, 2020 its previous repurchase agreement with the BSP after borrowing P300 billion at zero interest rate.

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BSP Governor Benjamin Diokno announced on Oct. 1 that the Monetary Board approved the request of the national government for a fresh provisional advance of P540 billion to be used for deficit financing as a result of the pandemic. The P540 billion will be settled on or before Dec. 29, 2020 at zero interest.

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