Peso appreciation trims NG debt in October

Published November 29, 2019, 12:00 AM

by manilabulletin_admin

By Chino S. Leyco

The national government’s debt slightly declined at end-October this year due to stronger peso against the US dollar, the Bureau of the Treasury reported yesterday.

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The outstanding debt of the national government stood at ₱7.906 trillion as of October, down 0.2 percent compared with ₱7.907 trillion in the previous month.

The “revaluation effect of peso appreciation” after the local currency averaged 50.77 last month from 51.79 in September marginally dragged down the total debt of the state, the treasury explained.

Of the total debt stock, 67.10 percent were domestic debt, while the remaining 32.9 percent were external obligations.

Year-on-year, however, the debt rose by 10 percent in October from ₱7.167 trillion.

According to the treasury, domestic debt at end-October reached ₱5.305 trillion, up 0.89 percent from ₱5.258 trillion in September and up 15 percent compared with ₱4.62 trillion in the same month in 2018.

“The increase resulted from a ₱47.53-billion net issuance of government securities, which was partially offset by a ₱0.52-billion reduction in the local currency valuation of onshore dollar bonds caused by peso appreciation,” the bureau said.

Since the beginning of the year, domestic debt has increased by ₱527.92 billion or 11 percent, while year-on-year growth was ₱684.55 billion or 15 percent.

Debt in the offshore lenders, meanwhile, declined 1.8 percent to ₱2.601 trillion from ₱2.5 trillion the previous month, but higher by 2.1 percent than the ₱2.547 trillion year ago.

“The decline can be attributed to local currency appreciation which trimmed the valuation of US dollar-denominated debt by ₱52.49 billion, as well as due to net repayments of loans amounting to ₱0.63 billion,” the treasury said.