Despite rising interest rates due to high inflation plus interest rate hikes here and abroad, the Bureau of the Treasury increased its domestic borrowing program for November.

Based on the Treasury advisory on Thursday, Oct. 27, the November financing plan of the Marcos administration increased by 7.5 percent to P215 billion from P200 billion programmed in the previous month.

National Treasurer Rosalia V. De Leon said the increase in the government’s local financing plan was because of the extra week in November.

The bureau indicated that it will sell P75 billion worth of Treasury bills (T-bills) and P140 billion in Treasury bonds (T-bonds) next month.

The Treasury will still hold a weekly auction for T-bills and T-bonds, offering P5 billion worth of each 91-, 182-day and 364-day long-term IOUs every Monday and issue them on Nov. 3, 9, 16, 23 and 29.

Moreover, the agency will issue P35 billion worth of three-, five-, 12-, 20-year T-bonds on Nov. 4, 10, 17, and 24, respectively.

Earlier, Finance Secretary Benjamin E. Diokno said the government will continue borrowing mostly from the domestic debt markets under the Marcos administration.

For 2022, the government aims to raise P2.2 trillion to enable the economy’s strong and resilient growth, Diokno said.

“The Marcos administration plans to continue this borrowing mix by obtaining 75 percent or around P1.65 trillion from domestic markets to insulate the country from foreign exchange volatilities due to ongoing global uncertainties,” Diokno said.

Earlier, Bangko Sentral ng Pilipinas (BSP) Governor Felipe M. Medalla wants to match the monetary move of the US Federal Reserve, noting that “in this case, must first respond to the Fed point by point.”

The central bank chief also reiterated that he would vote to raise policy rates by 75 basis points if the US Fed will deliver the same magnitude at the conclusion of its next policy meeting.

The BSP still has leeway to be more aggressive in its policy tightening to support the peso against the US dollar, the central bank governor said.

However, Medallas said any action on interest rates will depend on the decision of the seven-member policy-making Monetary Board, which he has only one vote.

"I personally believe we must be a little bit more aggressive in increasing rates also because I think the economy can withstand it," Medalla said.

Last Monday, Medalla said the BSP may increase the policy rate by more than 100 basis points before the end of 2022, if the US Fed would adjust its own borrowing cost by 150 basis points.

The next policy meetings of the Monetary Board are scheduled on Nov. 17 and Dec. 15.