Due to the government’s increased borrowing from both local and foreign lenders, compounded by the recent peso slump, the national government’s outstanding debt nearly exceeded the historic high of ₱17.563 trillion posted in July.

Data from the Bureau of the Treasury (BTr) showed that the country’s debt pile reached ₱17.562 trillion as of end-October, ₱106.8 billion, or 0.61 percent, higher than the previous month’s ₱17.46 trillion.

“The expansion was driven by net issuances of domestic and external liabilities, as well as the upward revaluation effects of the weaker peso against the United States (US) dollar,” the BTr said in a Dec. 2 statement.

Notably, the end-October level stood ₱202 billion higher than the forecast end-2025 debt level of ₱17.36 trillion. Compared to last year’s debt stock, the end-October figure was 9.6 percent higher than ₱16.02 trillion.

Debt sourced from domestic lenders increased by ₱72.4 billion, or 0.6 percent, to ₱12.05 trillion from ₱11.97 trillion in September, “as the net issuance of government securities for the month amounted to ₱70.7 billion, and as peso depreciation added ₱1.78 billion to the local currency valuation of retail dollar bonds (RDBs).”

Almost the entire amount came from government debt securities, with only ₱160 million from loans.

Domestic borrowings remain the majority at 68.6 percent of total debt, a share the BTr said is consistent with its debt strategy of prioritizing peso-denominated financing “to mitigate foreign exchange risks and foster the development of the domestic bond market.”

Meanwhile, foreign debt rose by ₱34.4 billion, or 0.63 percent, to ₱5.52 trillion from ₱5.48 trillion in September. This increase was attributed to fresh foreign loans and the higher peso value of dollar-denominated debt due to exchange rate movements, which recently pushed the local currency to its lows.

“Peso depreciation against the US dollar added ₱58.6 billion to the debt total, while peso appreciation against third currencies provided an offset of ₱32.5 billion,” said the BTr. The foreign exchange (forex) rate used to value the total debt stock was ₱58.771:$1, higher than the previous month’s ₱58.149:$1.

Year-to-date, overall borrowings expanded to ₱2.48 trillion despite a reduction in foreign borrowings. It accounted for 95.4 percent of the government’s total planned financing of ₱2.6 trillion for 2025.

Based on the Budget of Expenditures and Sources of Financing (BESF) document for fiscal year (FY) 2026, the government’s debt level is expected to exceed ₱19 trillion by the end of 2026, nearly 10 percent higher than the projected end-2025 level.

Next year’s borrowing mix will be 77:23, meaning 77 percent of debt will be sourced domestically while 23 percent will come from external sources. This marks a shift from this year’s 81:19 borrowing mix.