Weekly Fixed Income Summary : April 02 – 06, 2018

Weekly-Fixed-Income-Summary-and-Outlook
Rising Yield Curve Outlook. Bond yields will remain elevated amid (1) rising expectations of a hike by the Bangko Sentral ng Pilipinas (BSP); (2) steadily rising local inflation (up 4.3% in March, based on 2012 index); (3) allayed trade war fears by Chinese President Xi Jinping, shifting money out of safe haven assets like US Treasuries; and (4) Fed hike... Read More

Weekly Fixed Income Summary : March 26 – 28, 2018

Weekly-Fixed-Income-Summary-and-Outlook
Inflation, TRAIN-2 Put Upward Pressure on Yields Outlook. We expect upward pressure on bond yields to persist, especially given (1) Bangko Sentral’s (BSP) recent release of its March inflation expectation of 3.8%-4.6% (based on 2012 index), markedly higher than February’s 3.9%; and (2) news that the Lower House’s version of the second tax reform package is revenue-eroding, at least for... Read More

Weekly Fixed Income Summary : March 19 – 23, 2018

Weekly-Fixed-Income-Summary-and-Outlook
Markets Still Expect BSP Hike Outlook. We expect bond trading to be sidelined amid the shortened work-week. The Bangko Sentral ng Pilipinas (BSP) decided to stand pat last week, as expected, but programmed borrowing in the second quarter is expected to grow by 35% quarter-on-quarter (QoQ) to Php325bn ($6.2bn), pressuring up interest rates. The debt auctions will also be more... Read More

Weekly Fixed Income Summary : March 12 – 16, 2018

Weekly-Fixed-Income-Summary-and-Outlook
Firm US CPI Abate Fears of Aggressive Fed Hike Outlook. The bond market will keep its eyes on the Bangko Sentral’s monetary board meeting this Thursday (March 22) and the Fed’s meeting this Wednesday-Thursday. While while several officials from the BSP have insisted that inflation is still manageable and the policy rate is still appropriate, there are some analysts who... Read More

Weekly Fixed Income Summary : March 05 – 09, 2018

Weekly-Fixed-Income-Summary-and-Outlook
Trade War Fears Tapers Outlook. We expect bond trading to be sidelined this week ahead of the Bangko Sentral’s (BSP) monetary board meeting next week (March 22). Expectations of a BSP hike this March continue to mount amid upward pressure on yields upon the release of rising inflation. BSP Governor Espenilla noted that the spike in inflation is transitory and... Read More

Weekly Fixed Income Summary : February 29 – March 02, 2018

Weekly-Fixed-Income-Summary-and-Outlook
Trade War Fears Outlook. Upward pressure on yields on the release of rising inflation. February inflation clocked in at 4.5%, a 3-yr high and higher than the Department of Finance’s (DoF) 4.1% estimate, January’s 4.0%, but in line with both the Bangko Sentral’s (BSP) estiamte of 4.0%-4.8% and consensus expectation of at least 4.5%, driven by the food and non-alcoholic... Read More

Weekly Fixed Income Summary : February 19 – 23, 2018

Weekly-Fixed-Income-Summary-and-Outlook
Interest Rate Pressures Grow Outlook. Upward pressure on interest rates still present, but the liquidity released by the recent reserve requirement cut estimated to be worth Php90bn has tempered the rate rise in the belly to the 10-yr; last week the liquid 10-yr (10-61) fell by 79bps week-on-week to 5.86%. Still, the yield curve is projected to grow even steeper... Read More

Weekly Fixed Income Summary : February 12 – 16, 2018

Weekly-Fixed-Income-Summary-and-Outlook
First Metro Weekly Fixed Income Summary and Outlook – February 12 – 16, 2018 Outlook. Interest rate pressures rising but the reserve requirement is acting like a sort of damper. Banks have not actually hiked their mortgage rate, although auto rates have inched up a bit. The Bureau of Treasury has been doing partial awards, also to temper the rate... Read More

Weekly Fixed Income Summary : February 05 – 09, 2018

Weekly-Fixed-Income-Summary-and-Outlook
First Metro Weekly Fixed Income Summary and Outlook – February 05 – 09, 2018 Outlook. Bond yields to remain elevated. The short-end rose, reflected in higher T-bill rates in the latest auction. Government had to reject to temper it. T-bill auction results: Average bid rates were 2.670%, 2.854%, and 3.04%, respectively, all higher than the previous auction’s average rates. Bid-to-cover... Read More

Weekly Fixed Income Summary : Jan. 29 – Feb. 02, 2018

Weekly-Fixed-Income-Summary-and-Outlook
First Metro Weekly Fixed Income Summary and Outlook – January 29 – February 02, 2018 Outlook. There’s continuing upward pressure on local bond yields this week due to higher-than-expected inflation of 4.0% in January, a big surprise given consensus expectation of 3.3% and the BSP likely doing a preemptive rate hike come Thursday. The sell-off in equities may not necessarily... Read More