Hurricane Ida plunges New Orleans into darkness amid Louisiana flooding

August 30, 2021 | 4:44 pm

NEW ORLEANS — Hurricane Ida pounded Louisiana after sweeping ashore from the Gulf of Mexico, flooding wide areas under heavy surf and torrential rains as fierce winds toppled trees and power lines, plunging New Orleans into darkness after nightfall.

The storm, though greatly diminished as it churned inland toward western Mississippi early on Monday, was expected to continue unleashing heavy downpours “likely to result in life-threatening” flooding, the National Hurricane Center said.

Sunday night, the sheriff’s office in Ascension Parish reported the first known US fatality from the storm, a 60-year-old man killed by a tree falling on his home near Baton Rouge, the state capital.

Ida, the first major hurricane to strike the United States this year, made landfall around noon on Sunday as a ferocious Category 4 storm over Port Fourchon, a hub of the Gulf’s offshore oil industry, packing sustained winds of up to 150 miles per hour (240 km per hour).

Its arrival came 16 years to the day after Hurricane Katrina, one of the most catastrophic and deadly U.S. storms on record, struck the Gulf Coast, and about a year after the last Category 4 hurricane, Laura, battered Louisiana.

US President Joseph R. Biden, Jr., declared a major disaster in the state, ordering federal assistance to bolster recovery efforts in more than two-dozen storm-stricken parishes. The full extent of storm damage remained to be seen at daybreak.

Ida crashed ashore as Louisiana was already reeling from a resurgence of coronavirus disease 2019 (COVID-19) infections that have strained the state’s healthcare system, with an estimated 2,450 COVID-19 patients hospitalized statewide, many in intensive care units.

A loss of generator power at the Thibodaux Regional Health System hospital in Lafourche Parish, southwest of New Orleans, forced medical workers to manually assist respirator patients with breathing while they were moved to another floor, the state Health Department confirmed to Reuters.

Within 12 hours of landfall, Ida had weakened into a Category 1 hurricane on the five-level Saffir-Simpson scale, with top winds clocked at 85 mph (135 kph) as the storm pushed about 100 miles inland past New Orleans, Louisiana’s largest city, early on Monday.

By then, Ida had plowed a destructive path that submerged much of the state’s coastline under several feet of surf, with flash flooding reported by the National Hurricane Center across southeastern Louisiana.

Nearly all offshore Gulf oil production was suspended in advance of the storm, and major ports along the Louisiana and Mississippi coasts were closed to shipping.

WIDESPREAD OUTAGES
Power was knocked out Sunday night to the entire New Orleans metropolitan area following the failure of all eight transmission lines that deliver electricity to the city, the utility company Entergy Louisiana reported.

One transmission tower collapsed into the Mississippi River, the Jefferson Parish Emergency Management Department said.

More than one million Louisiana homes and businesses in all were without electricity by late Sunday night, according to the tracking site Poweroutage.US.

Residents of the most vulnerable coastal areas were ordered to evacuate days ahead of the storm. Those riding out the storm in their homes in New Orleans braced for the toughest test yet of major upgrades to a levee system constructed following devastating floods in 2005 from Katrina, a hurricane that claimed some 1,800 lives.

“I almost found myself in a panic attack when news announced this was the anniversary of Katrina,” Janet Rucker, a lifelong New Orleans resident and recently retired sales manager who took shelter in a downtown hotel with her dog, Deuce. “This is just not good for our nerves and our psyche.”

The US Army Corps of Engineers said the newly reinforced New Orleans levees were expected to hold, though they said they said the flood walls could be overtopped in some places.

Hundreds of miles of new levees were built around New Orleans after flooding from Katrina inundated much of the low-lying city, especially historically Black neighborhoods.

Inundation from Ida’s storm surge — high surf driven by the hurricane’s winds — was reported to be exceeding predicted levels of 6 feet (1.8 m) along parts of the coast. Videos posted on social media showed storm surge flooding had transformed sections of Highway 90 along the Louisiana and Mississippi coast into a choppy river.

“We’re as prepared as we can be, but we’re worried about those levees,” said Kirk Lepine, president of Plaquemines Parish, and one of the most vulnerable areas along the Gulf Coast.

The parish later issued an alert on Facebook urging residents of one area to seek higher ground after reports of an overtopped levee. — Devika Krishna Kumar/Reuters

Japan’s Gunma prefecture reports contaminant in Moderna COVID-19 vaccine

August 30, 2021 | 3:27 pm

TOKYO — A contaminant was found in Moderna’s coronavirus disease 2019 (COVID-19) vaccine on Sunday in Japan’s Gunma prefecture, near Tokyo, the latest such case in the country involving the US company’s vaccines. A tiny, black substance was found in a Moderna Inc. vaccine vial, prompting the prefecture to suspend inoculation using vaccines from the Moderna lot from which the vial had come, a Gunma prefecture official said.

Japan’s health ministry said on Saturday two people died after receiving Moderna’s vaccine shots that were among lots later suspended following the discovery of contaminants.

The government had said that no safety or efficacy issues had been identified and that the suspension was a precaution. The causes of death are being investigated.

Last week, Japan halted the use of 1.63 million Moderna doses, shipped to 863 vaccination centers nationwide, after the domestic distributor, Takeda Pharmaceutical, received reports of contaminants in some vials.

Moderna and Spanish pharma company Rovi, which bottles Moderna vaccines for markets other than the United States, had said at the time that the contamination could be due to a manufacturing issue in one of Rovi’s production lines.

The vaccine in question in Gunma is from a Moderna lot that is different from those whose use has already been suspended, the Gunma official said.

Vaccines from the same lot have been administered to 4,575 people in Gunma, but the prefecture has heard no reports of ill health, the official said.

Contaminants were found in Moderna vaccines in Japan’s southern prefecture of Okinawa, as well. — Reuters

Chinese foreign minister tells top US diplomat world must ‘positively guide’ Taliban

August 30, 2021 | 2:40 pm

BEIJING — Chinese State Councillor and Foreign Minister Wang Yi told US Secretary of State Antony Blinken in a phone call on Sunday that the international community should engage with Afghanistan’s new Taliban rulers and “positively guide” them, China’s foreign ministry said.

Washington should work with the international community to provide economic and humanitarian aid to Afghanistan, help the new regime run governmental functions normally, maintain social stability, and stop the currency from depreciating and the cost of living from rising, Mr. Wang said, according to a statement.

“While respecting the sovereignty of Afghanistan, the US should take concrete action to help Afghanistan fight terrorism and stop violence, rather than playing double standards or fighting terrorism selectively,” Mr. Wang said, warning that the “hasty withdrawal” could allow terrorist groups to “regroup and come back stronger.”

Chinese state TV said the call was made at the invitation of Washington.

State Department spokesperson Ned Price said in a statement that Messrs. Blinken and Wang spoke about “the importance of the international community holding the Taliban accountable for the public commitments they have made regarding the safe passage and freedom to travel for Afghans and foreign nationals.”

Before the chaos of the past two weeks, US officials had argued that withdrawing from Afghanistan would free up time and attention of senior US political and military leaders, as well as some military assets, to focus on the Indo-Pacific and the challenge posed by China, which the Biden administration has declared its foreign policy priority.

But China’s state-controlled media have seized on the often chaotic pullout, portraying US support for allies as fickle.

China has not officially recognized the Taliban as Afghanistan’s new rulers, but Wang Yi last month hosted Mullah Baradar, chief of the group’s political office, and has said the world should guide and support the country as it transitions to a new government instead of putting more pressure on it.

Mr. Wang earlier told Mr. Blinken in a call on Aug. 16 that the hasty pullout of US troops from Afghanistan had a “serious negative impact,” but pledged to work with Washington to promote stability in the country.

But Mr. Wang said Washington could not expect China’s cooperation if it was also trying to “contain and suppress China and harm China’s legitimate rights and interests,” Chinese state media reported at the time of the earlier call.

The engagement comes as relations between Beijing and Washington are at their lowest point in decades and just after the release of a US intelligence assessment into the origins of COVID-19 that China said “wrongly” claimed that Beijing was hindering the investigation and dismissed as “not scientifically credible.”

The two diplomats also discussed US-China ties on Sunday, according to the Chinese statement.

Mr. Wang said recent communications between the two countries on Afghanistan and climate change show that dialogue and cooperation are better than confrontation, it said.

“China will consider how to engage with the US side based on the US attitude towards China,” Mr. Wang was quoted as saying. — Reuters

Fauci backs COVID-19 vaccine mandate for US school children

August 30, 2021 | 1:58 pm

WASHINGTON — Dr. Anthony S. Fauci, the top US infectious disease expert, said on Sunday he supports coronavirus disease 2019 (COVID-19) vaccine mandates for children attending schools as the highly contagious Delta variant of the coronavirus continues to fuel a surge in cases in the nation.

“I believe that mandating vaccines for children to appear in school is a good idea,” Dr. Fauci told CNN’s State of the Union program. “We’ve done this for decades and decades, requiring polio, measles, mumps, rubella, hepatitis” vaccinations.

Currently, children under 12 are not eligible to receive the COVID-19 vaccine. But Dr. Fauci, in a separate interview on ABC’s This Week program, said there should be enough data by early October for the U.S. Food and Drug Administration to consider whether the shot is safe for children under that age.

“I think there’s a reasonable chance” that the Pfizer-BioNTech or Moderna vaccines could get FDA clearance for kids under 12 before the upcoming holiday season, Dr. Fauci, the director of the National Institute of Allergy and Infectious Diseases and chief medical adviser to the White House, said last Tuesday.

As schools reopen for the fall, the rise in coronavirus cases is already causing significant disruptions.

Dozens of schools nationwide have had to delay the start of the school year or shut down since opening in August, according to data from tracking website Burbio. Its data shows the impact on schools so far has been heaviest in the South, the epicenter of the current surge in cases and where vaccination rates among those already eligible are generally the lowest in the country.

The reopening of schools is also contributing to a supply shortage of COVID-19 tests in the United States as schools revive surveillance programs that will require tens of millions of tests, according to industry executives and state health officials, Reuters reported last week. — Linda So/Reuters

PM says Singapore must remain open as anxiety over job competition grows

August 30, 2021 | 1:55 pm

SINGAPORE — Singapore must stay open to preserve its status as a global business hub, its prime minister said on Sunday, even as the country continues to tighten its foreign worker policies and addresses anxieties among locals over competition for jobs.

Foreign labor has long been a hot button issue in Singapore, but uncertainties due to the coronavirus disease 2019 (COVID-19) pandemic have increased employment worries among locals as the city state recovers from last year’s record recession.

“We must make it crystal clear to the world that Singapore is determined to stay open, in order to earn a living for ourselves,” Lee Hsien Loong said in his National Day Rally speech. He said the country must not give the impression that Singapore is becoming xenophobic and hostile to foreigners.

“It would gravely damage our reputation as an international hub. It would cost us investments, jobs, and opportunities. It would be disastrous for us.”

While Singapore will continue to tighten its foreign worker policies, it will only do so gradually so as not to hurt businesses, Mr. Lee said. The government will also pass a law to ensure fair hiring, he said.

Mr. Lee’s government has been tightening foreign worker policies for several years while taking steps to promote local hiring, including by raising the salary threshold for issuing work permits.

Just under 30% of Singapore’s 5.7 million population are non-residents, up from around 10% in 1990, according to government statistics.

On Sunday, Singapore hit a key milestone of fully vaccinating 80% of its population against COVID-19, setting the stage for further reopening of the economy as the country gets ready to live with the virus as endemic.

“We may have to tap on the brakes from time to time, but we want to avoid having to slam on the brakes,” Mr. Lee said.

“So in the next phase, we will move step by step not in one big bang like some countries but cautiously and progressively, feeling our way forward,” Mr. Lee added. — Reuters

Voter’s registration now among the government services offered at SM

August 30, 2021 | 10:00 am

James B. Jimenez, Director IV, Education and Information Department, COMELEC , Atty. Aimee P. Ferolino, Commissioner, Commission on Elections , Mr. Steven T. Tan, President, SM Supermalls — From (L-R) James B. Jimenez, Director IV, Education and Information Department, COMELEC Atty. Aimee P. Ferolino, Commissioner, Commission on Elections Mr. Steven T. Tan, President, SM Supermalls Atty. Divine E. Blas-Perez, Director IV, Election and Barangay Affairs Department, COMELEC Mr. Bien C. Mateo, Senior Vice President, SM Supermalls

SM Supermalls and Commission on Elections (COMELEC) have officially teamed up to provide voters with more registration venues at SM. After signing a Memorandum of Agreement last August 27, 2021, at Level 2 South Entertainment Mall SM Mall of Asia, COMELEC has opened satellite registration centers in SM Supermalls nationwide. This gives the public a safer, more convenient option amidst the prevailing Covid health crisis.

COMELEC is the latest government agency to partner with the mall chain in bringing basic government services closer to the public. Other in-mall government services include Covid vaccination, international vaccine certification at the Bureau of Quarantine satellite office, National ID registration, passport application, and express services from government agencies such as PAGIBIG, PhilHealth, SSS, and GSIS.

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With the approaching September 30 registration deadline, a good turnout of registrants is expected. In view of this, health and safety standards will be strictly observed. The voter’s registration center, like all other government service centers in the mall, is required to follow the Safety Protocols issued by the IATF. COMELEC shall limit the number of registrants per day. Execution of health declaration forms, checking of body temperature and physical distancing along with the mandatory face mask and face shields will be enforced on site.

47 SM Supermalls across the country will participate in this effort. This will help ease and unburden registration traffic in barangays, providing the public with a more convenient, faster, and safer way to access the registration process. For SM Supermalls with the Voter’s Registration Center and schedules, visit https://www.smsupermalls.com/whats-new/voters-registration-now-among-the-government-services-offered-at-sm/ or follow @smsupermalls on all social media accounts.

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In celebration of National Heroes’ Day, Vista Mall and Starmall pay tribute to courier and delivery riders

August 30, 2021 | 8:00 am

In celebration of National Heroes’ Day, Vista Mall and Starmall pay tribute to lucky riders of GetAll, Foodpanda, and other accredited couriers who are the malls’ partners for their online delivery services. The lucky riders, who were in the vicinity of Vista Mall and Starmall branches nationwide, were given grocery packs, as tokens for their hard work during the pandemic.

IFC eyes record investment in East Asia

August 30, 2021 | 12:34 am

skyline-building — PHILIPPINE STAR/ MICHAEL VARCAS

THE INTERNATIONAL Finance Corp. (IFC), a member of the World Bank Group, is ramping up investments in East Asia and the Pacific economies to as much as $5 billion to help the region rebound from the pandemic and combat climate change, a top official said.

“For the next year, we’re targeting long-term investments of $4-5 billion across East Asia and the Pacific [for a] green, resilient and inclusive growth,” IFC’s newly appointed Regional Director for East Asia and the Pacific Kim-See Lim told BusinessWorld in an interview on Aug. 20.

If realized, this meant the World Bank’s private sector arm will exceed its record-high commitments of $3.8 billion in the previous fiscal year (July 1, 2020 to June 30, 2021).

“Many of the countries around the region and globally, the governments are facing fiscal deficits and therefore have not a lot of headroom to help the region and the private sector recover, so it’s key part of our mandate to use private sector solutions to help the region go back stronger,” Ms. Lim said.

Addressing climate change and marine plastic pollution are also top priorities for the IFC in the region, which is highly vulnerable to natural hazards, she said.

Ms. Lim said they are targeting to expand the institution’s climate financing to 35% of its total long-term investment portfolio by 2025, and align 85% of new direct investments with the Paris agreement by July 2023.

The agreement aims to limit the global temperature rise to 1.5 degrees Celsius, which experts say would require the world to achieve net zero emissions by 2050.

Currently, 26% of all the IFC-supported projects are focused on mitigating the impact of climate change and addressing the marine plastic crisis.

By July 2025, Ms. Lim said all of the IFC’s new direct investments should be aligned with the Paris Agreement.

The IFC also aims to sustain and even grow its investments in the Philippines, after investing $399 million across four local companies in the past fiscal year, IFC Country Manager for the Philippines Jean-Marc Arbogast said in the same interview.

Further, Ms. Lim said the IFC is planning to finance more climate-related projects in the Philippines since it is one of the world’s most disaster-prone nations and most exposed to the impact of climate change.

“We are definitely looking for opportunities to do more things in the Philippines in climate finance. But we cannot give a definitive answer [on target investments], because it depends on the client and the opportunities that come our way,” she said.

Mr. Arbogast said the IFC has a number of projects in the pipeline that it is considering to finance across strategic priority areas on climate change, financial inclusion, infrastructure and human capital development.

He noted infrastructure is among the most underinvested sectors in the country as the existing financing is not enough to close the infrastructure gap.

The country could open up the infrastructure market and attract more investments in the sector to bring in not only additional capital, but also technical know-how, he said.

Internet connectivity and affordable healthcare are also among the sectors that are lacking in investments in the Philippines, according to Mr. Arbogast, who noted both are crucial during the ongoing pandemic.

Ms. Lim, the IFC regional director, said much of the economic and development gains the region achieved in the past 10-20 years were reversed during the pandemic.

“Governments have less and less fiscal space to provide more support for businesses, because of these very stretched resources. So all in all, I think there is much need for a bigger role for the private sector to play and this is where IFC will step up, to help the private sector in this recovery in the next few years,” she added.

Despite the impact of the pandemic, Ms. Lim said the IFC continued to balance its portfolio and businesses to sustain its financing to clients while managing the risks on its own balance sheet.

“Because we’re a global institution, we have the largest source of multilateral financing. That in itself provides some level of diversification, to the size of the portfolio and the geographies and the sectors that we have on our books,” she said.

In March 2020, the IFC launched an $8-billion fast-disbursing financing facility that pandemic-hit clients could access. It also has a $4-billion global health platform that aims to boost healthcare supplies in developing countries. — Beatrice M. Laforga

Bankers support proposed PDIC charter amendments

August 30, 2021 | 12:33 am

By Luz Wendy T. Noble, Reporter

TOP BANKING GROUPS expressed support for the proposed legislation that would introduce changes to the Philippine Deposit Insurance Corp. (PDIC) charter, including a regular review of the maximum deposit insurance coverage for account holders.

In an e-mail, the Bankers Association of the Philippines (BAP) said it believes that the maximum deposit insurance “must be indexed to inflation and that the PDIC board must be allowed to make timely adjustments to this amount.”

The BAP’s position is in line with the provisions of Senate Bill (SB) 2365 and House Bill (HB) 8818. Both bills would require the PDIC board of directors to review the maximum deposit insurance coverage every three years and allow them to increase the coverage based on inflation and other economic indicators that may be relevant.

To fulfill this mandate, the PDIC board will be allowed to get the service of independent actuarial consultants and other experts to consider the feasibility and sustainability of a higher maximum deposit insurance coverage.

At present, the PDIC provides a maximum deposit insurance coverage of P500,000 per depositor for each bank.

The maximum deposit insurance coverage was last increased to P500,000 from P250,000 in April 2009, as part of efforts to boost depositors’ confidence amid the global financial crisis.

“An increase to the maximum deposit insurance must provide a balance between the PDIC’s sustainability and rationalizing the financial costs banks are incurring,” BAP said.

The House of Representatives passed HB 8818 in March, while SB 2365 is still pending at the Senate committee level.

The Chamber of Thrift Banks (CTB) also backed the proposal to raise the maximum deposit insurance coverage for depositors, but want assurance that the assessment rate under the original PDIC charter will be retained.

CTB Executive Director Suzanne I. Felix is referring to the contribution of PDIC member banks to the Deposit Insurance Fund (DIF), which is the source of the agency’s deposit insurance payouts.

This fund allows the PDIC to pay deposit insurance claims to depositors within a set turnaround time in cases of bank closures.

Member banks are assessed the annual flat rate of 1/5 of 1% of their total deposit liabilities. The assessments are collected semi-annually and form part of the DIF. This fund is managed through prudent investments as mandated by the PDIC charter.

“Increase in coverage will create stability for the banking system as this will boost public confidence/trust in the banking sector,” Ms. Felix said in an e-mail.

“However, banks are adversely affected by the pandemic, particularly their loan portfolios, hence cannot afford any increase in premium. Thrift banks, in particular, need to address the requirements of their MSME (micro-, small-, and medium-sized enterprises) clients who have also been severely affected by the crisis,” she added.

Also, Ms. Felix said the group supported the proposal for PDIC to become an attached agency of the Bangko Sentral ng Pilipinas (BSP) “for policy program and coordination.”

PDIC is currently an attached agency of the Department of Finance.

In a statement last week, the BSP said making PDIC an attached agency of the central bank is in line with recommendations of the International Monetary Fund. It said this move is expected to “enhance synergy among BSP, PDIC and other domestic financial regulators in promoting the country’s financial stability.”

Work on China-funded railway to start in March

August 30, 2021 | 12:32 am

By Arjay L. Balinbin, Senior Reporter

THE GOVERNMENT is aiming to start the construction of a China-funded rail line from Calamba, Laguna to Daraga, Albay by March next year, the Transportation department said.

The P142.48-billion design-and-build contract of the railway project, also known as the Banlic (Calamba)-Daraga segment of the PNR South long-haul project, is targeted to be awarded in October, the office of Transportation Undersecretary for Railways Timothy John R. Batan said in a statement sent to BusinessWorld on Aug. 26.

The Transportation department said the government of the People’s Republic of China has short-listed three bidders for the contract: China Railway Group Ltd. and China Railway Number 3 Engineering Co., Ltd. & China Railway Engineering Consulting Group Consortium Ltd. Joint Venture; China Road and Bridge Corp.; and Power Construction Corp. of China, Ltd.

Bid documents posted on the official website of the department showed that the 380-kilometer project involves the construction of 23 stations and a depot.

The partial operability segment is from San Pablo, Laguna to Pagbilao, Quezon. It is expected to start operations in the second quarter of 2022.

The full operation of the PNR project is slated for 2025.

In its invitation to bid, the Transportation department said completion of the construction works is required within 36 months.

Bidders should have completed a contract similar to the project within the last 20 years, it added.

“Bidding will be conducted through Limited Competitive Bidding procedures using non-discretionary ‘pass/fail’ criterion,” it added.

Apart from this PNR project, the other railway projects funded by China’s official development assistance are the P81.69-billion Mindanao Railway Project Phase 1 and the P50.03-billion Subic Clark Railway.

Tax effort improves in first six months

August 30, 2021 | 12:31 am

THE SHARE of tax collections in the country’s economic output improved to 14.74% in the first half but still below the pre-crisis level, the Department of Finance (DoF) said on Sunday.

In its latest economic bulletin, the DoF said the first semester tax effort, which is the share of tax collections to gross domestic product (GDP), went up by half of a percentage point from 14.19% in the first half of 2020.

However, this is still lower than the pre-pandemic level of 14.86% in the first semester of 2019.

“Tax collections improved partly due to tax reforms which include legislative measures and digitalization of revenue collections’ operations,” the agency said.

The P1.034-trillion taxes collected by the Bureau of Internal Revenue (BIR) between January and June was equivalent to 11.32% of GDP, up from its 11.15% tax effort in the same period last year.

The Bureau of Customs’ tax take of P302.74 billion contributed 3.31% to the overall economic output, higher than 2.95% a year ago.

The country’s two main collection offices saw revenues increase from year-ago levels by 8.11% and 11%, respectively, as economic activity picked up.

Other agencies also reported slightly higher tax effort at 0.11% in the first half from 0.1% the year prior.

Despite this, however, the share of overall state revenues to GDP still declined to 16.35% last semester from 16.94% a year ago due to lower non-tax revenues.

Revenues generated via other non-tax sources slid by 38% year on year to P147 billion during the period. This is equivalent to 1.61% of total economic output, down from 2.75% a year ago.

With a higher expenditure effort at 24.41%, the DoF said the government’s budget deficit widened to 7.86% of GDP in the first half from 6.53% in the same six-month period last year.

Economic managers capped the fiscal deficit at 9.3% of GDP by year’s end.

The DoF said the country should continue adopting fiscal reforms to sustain the upward trend of its tax effort, especially the remaining tax bills pending in Congress such as the proposed Real Property Valuation and Assessment Reform Act and the Passive Income and Financial Intermediary Taxation Act.

“Due to fiscal reforms, the country was able to fund the unprecedented fiscal requirements imposed by the pandemic and, at the same time, protect its strong macroeconomic fundamentals,” it added. — Beatrice M. Laforga

Rates of T-bills, T-bonds likely to move sideways on Fed bets

August 30, 2021 | 12:05 am

THE BUREAU of the Treasury is looking to raise P250 billion from the domestic market in September. — BW FILE PHOTO

RATES OF government securities on offer this week may drop as the market waits for clearer hints from the US central bank on their plan to taper their bond-buying program.

The Bureau of the Treasury (BTr) is looking to raise P15 billion via the Treasury bills (T-bills) it will auction off on Tuesday, or P5 billion each in 91-, 182- and 364-day debt papers.

On Wednesday, the BTr will offer P35 billion in reissued five-year Treasury bonds (T-bonds) with a remaining life of four years and seven months.

The BTr moved the auction schedules as financial markets are closed today, Aug. 30, in observance of National Heroes Day.

Two bond traders said the average rates of the T-bills could move sideways from their week-ago levels amid ample demand for short-term debt.

Meanwhile, the first trader said the five-year T-bond’s average yield could range from 2.65-2.8% on Wednesday. The second trader gave a narrower forecast band of 2.75-2.85%.

The traders said the market will take their cue from the US Federal Chief Jerome H. Powell’s speech at the US central bank’s Jackson Hole symposium on Friday.

Mr. Powell said there has been clear progress toward maximum employment and that he was of the view that if the US economy evolved broadly as anticipated, “it could be appropriate to start reducing the pace of asset purchases this year,” Reuters reported.

However, he told the Fed’s annual late-August symposium in Jackson Hole, Wyoming, that the timing and pace of tapering does not involve a signal for when interest rates will begin to rise, a message the market perceived as being dovish.

“While there is no specific timetable or signals for tapering of bond purchases, investors may assume that tapering will likely not happen this year and that may drive the demand for notes at the belly of the curve,” the first trader said.

The BTr last week borrowed P15 billion as planned via its auction of T-bills as total tenders hit P50.867 billion.

Broken down, it raised the programmed P5 billion via the 91-day debt papers at an average rate of 1.077%, slightly higher than the 1.066% seen on Aug. 16.

The government also borrowed P5 billion as planned via the 182-day T-bills. The six-month debt was quoted at an average rate of 1.408%, inching up from the week-ago level of 1.407%.

Lastly, the Treasury made a full P5-billion award of the 364-day papers it offered as the tenor’s average rate eased to 1.612% from 1.617% the previous week.

Meanwhile, the last time the BTr offered the five-year bonds on the auction block on Wednesday was on May 6, when it made a full P35-billion award out of P75.716 billion in bids.

The papers fetched an average rate of 3.295% at that auction, lower than the 3.3% coupon quoted for the bonds when they were first offered on April 6.

At the secondary market on Friday, the 91- 182- and 364-day T-bills were quoted at 1.141%, 1.442% and 1.632%, respectively, while the five-year tenor ended at 2.965%, based on the PHL Bloomberg Valuation Reference Rates published on the Philippine Dealing System’s website.

The Treasury is looking to raise P250 billion from the local market in September: P75 billion via weekly offers of T-bills and P175 billion from weekly auctions of T-bonds.

The government wants to borrow P3 trillion from domestic and external sources this year to help fund a budget deficit seen to hit 9.3% of gross domestic product. — B.M. Laforga with Reuters