Despite relatively weaker demand, the Marcos administration has successfully borrowed ₱22 billion through the sale of short-dated Treasury bills (T-bills) at over three-month-low borrowing costs.

During the latest T-bills auction on Sept. 29, the Bureau of the Treasury (BTr) fully awarded its planned fundraising of P22 billion, with total bids reaching ₱80.5 billion—nearly four times the amount of debt paper offered.

This week’s total bids were lower than the ₱117.8 billion in tenders from the previous T-bill auction on Sept. 22.

The government fully awarded the ₱7.5-billion offering for 91-day T-bills. Total tenders reached ₱31.2 billion. The average rate was 4.828 percent, 5.5 basis points (bps) lower than the 4.883 percent in the previous week.

For 182-day debt paper, the BTr raised ₱7.5 billion, fully awarding the offered amount. Bids reached ₱31.2 billion. It fetched an average rate of 5.075 percent, slightly lower than last week’s 5.081 percent.

Lastly, the BTr borrowed the offered ₱7 billion through 364-day IOUs. Demand reached ₱27.3 billion. Similarly, the average rate dropped slightly by 2.4 bps to 5.171 percent from 5.195 percent in the previous auction.

Prior to Monday’s auction, PHP Bloomberg Valuation (PHP BVAL) Reference Rates showed that the 91-, 182-, and 364-day T-bills were quoted at 4.935 percent, 5.164 percent, and 5.261 percent, respectively.

To note, the average rate for the three-month bills was the only rate that clocked in lower than the key borrowing cost set by the Bangko Sentral ng Pilipinas (BSP) at five percent. Meanwhile, longer-dated IOUs stood higher than the benchmark.

According to Michael Ricafort, chief economist at Rizal Commercial Banking Corp. (RCBC), the borrowing costs for short-term government debt securities have fallen for the 13th consecutive week.

This continued decline in yields is linked to optimism over the possible inclusion of the Philippines in J.P. Morgan’s Emerging Market Government Bond Index, which is expected to draw in more foreign funds, boost liquidity, and bring down borrowing costs.

The Philippines borrows more locally, through treasury bills and bonds, than from foreign sources. This borrowing strategy leverages domestic banks and creditors who are flush with cash while mitigating exposure to foreign exchange (forex) risks and volatility.

It can be recalled that the country’s debt-to-gross domestic product (GDP) ratio climbed to a 20-year high of 63.1 percent—further away from the Marcos Jr. administration’s target—as the national government’s outstanding debt continued to breach records in the second quarter of 2025.