The benchmark interest rate on debt falling due in seven years rose at Tuesday’s auction of the government IOUs at the Bureau of the Treasury.

Investors were willing to buy as much as P57.2 billion of the seven-year Treasury bonds, with a remaining life of six-years and nine-month. The demand was higher than the P35 billion on offer.

The rate of the IOUs rose to 4.468 percent from 3.826 percent seen in the previous auction. The bureau made a partial award amounting to only P19.3 billion.

National Treasurer Rosalia V. De Leon said the government opted to make a partial award at an interest rate aligned with the secondary market.

“We have built sufficient buffers, taking advantage when rates were low,” De Leon told reporters after the auction on Oct. 26.

She added that the government has been seeing improvements in revenue collections.

“Additional overseas development assistance inflows will also reinforce our cash position,” the treasurer concluded.

Source: Manila Bulletin (