Despite a milder appetite from domestic lenders following the Philippines’ disappointing growth, the Marcos Jr. administration still managed to borrow its planned amount of ₱22 billion through the sale of short-dated Treasury bills (T-bills) at slightly lower costs.

During the latest T-bills auction on Tuesday, Nov. 11, the Bureau of the Treasury (BTr) successfully raised its planned fundraising of ₱22 billion, with total bids reaching ₱98.3 billion—more than four times the amount of debt papers offered.

This week’s total bids were slightly higher than the ₱97.2 billion in tenders from the previous T-bills auction on Nov. 3.

The government fully awarded the ₱7-billion offering for 91-day T-bills, with total tenders reaching ₱32.9 billion. The average rate was 4.821 percent, 5.3-basis points (bps) lower than the 4.874 percent recorded in the previous week.

For 182-day debt papers, the BTr raised the ₱7.5-billion offered amount. Bids reached ₱33.1 billion, fetching an average rate of 4.981 percent, 4.5-bps lower than last week’s 5.026 percent.

Lastly, the BTr borrowed the offered ₱7.5 billion through 364-day IOUs. Demand reached ₱32.3 billion. Similarly, the average rate dropped 4.5 bps to 5.054 percent from 5.099 percent in the previous auction.

Prior to Tuesday’s auction, PHP Bloomberg Valuation (PHP BVAL) Reference Rates showed 91-, 182-, and 364-day T-bills were quoted at 4.949 percent, 5.073 percent, and 5.178 percent, respectively.

Average rates across the board remained higher than the key borrowing cost set by the Bangko Sentral ng Pilipinas (BSP) at 4.75 percent.

Rizal Commercial Banking Corp. (RCBC) chief economist Michael Ricafort said the across-the-board drop in borrowing costs comes on the heels of worse-than-expected output growth in the third quarter, at four percent.

This weaker gross domestic product (GDP) expansion, coupled with steady inflation in October, further reinforces the case for a reduction in the central bank’s key policy rate, Ricafort said.