Philippine Bonds Supported by Favorable Demand-Supply Dynamics

Philippine bonds may be rescued from a bout of underperformance by rising foreign demand in tandem with lower borrowings from the government.

The share of Philippine peso government bonds owned by foreigners has more than tripled to 6.03% as of August from 2021, according to the government, as overseas buyers bought bonds ahead of potential inclusion into JPMorgan Chase & Co.’s benchmark EM gauge. These inflows are set to continue as supply drops.