NATIONAL GOVERNMENT (NG) debt rose in May because it continued to lift funds to support financing needs, the Bureau of the Treasury (BTr) said.
The most recent data from the Treasury showed that outstanding debt stood at P18.55 trillion as of end-May, inching up by 0.41% from the previous month’s level of P18.47 trillion.
“The rise was primarily driven by the online incurrence of domestic securities as the federal government continued to lift funds to support financing needs, despite the continued Middle Eastern conflict,” the BTr said in an announcement on Thursday.
“Meanwhile, the appreciation of the peso against the US dollar and other foreign currencies helped temper the rise.”
The Treasury noted the local currency strengthened by 3.9 centavos against the dollar to P61.501 as of end-May from P61.54 as of end-April.
12 months on yr, outstanding debt went up by 9.62% from P16.92 trillion at end-May 2025.
NG debt is the full amount owed by the Philippine government to creditors comparable to international financial institutions, development partner-countries, banks, global bondholders and other investors.
The majority or 67.37% of the full debt stock got here from domestic sources, while the remaining were from external sources.
“This reflects the federal government’s prudent debt management strategy of prioritizing domestic financing to support local capital markets, while reducing exposure to foreign exchange risks,” the Treasury said.
Domestic debt, which was composed of presidency securities, inched up by 0.65% to P12.5 trillion at end-May from P12.42 trillion at end-April.
In line with the BTr, the month-on-month increase in domestic debt was “mainly resulting from P80.23-billion net issuance of presidency securities, while the peso appreciation trimmed P0.11 billion from onshore dollar bonds valuation.”
12 months on yr, domestic debt jumped by 6.07% from P11.78 trillion.
Meanwhile, external debt dipped by 0.07% to P6.051 trillion as of end-May from P6.055 trillion at end-April.
12 months on yr, it jumped by 17.77% from P5.14 trillion.
The BTr said the drop within the external debt is resulting from the numerous peso appreciation against the US dollar and other foreign currency.
“The favorable downward valuation effect of P18.91 billion outweighed the P14.9 billion in net external debt availment,” it added.
External debt was composed of P3.05 trillion in global bonds and P3 trillion in loans.
The NG’s guaranteed obligations jumped by 15.73% to P443.5 billion as of end-May from P383.23 billion within the previous month.
“This was partially offset by favorable revaluation effects on external guarantees, amounting to P60 million for local currency-denominated guarantees and P750 million for third currency-denominated guarantees,” it said.
The Treasury also cited repayments of external guarantees value P530 million.
12 months on yr, guaranteed obligations surged by 29.08% from P343.58 billion.
“The rise in outstanding debt to P18.55 trillion is just not surprising given the federal government’s ongoing financing needs for infrastructure, social programs, and economic development,” Reyes Tacandong & Co. Senior Adviser Jonathan L. Ravelas told BusinessWorld.
He said the more vital metric is whether or not the economy is growing fast enough to support the debt, quite than the debt’s absolute size.
“I expect debt levels to proceed rising in the approaching months as the federal government funds its budget requirements and refinances maturing obligations,” Mr. Ravelas said.
“Nonetheless, markets will likely be watching the debt-to-gross domestic product (GDP) ratio quite than absolutely the debt level,” he added.
The NG’s outstanding debt is projected to achieve P19.06 trillion by end-2026 under the Budget of Expenditures and Sources of Financing 2026.
The debt-to-GDP ratio stood at 65.2% in the primary quarter, up from 60.7% a yr earlier and its highest level for the reason that 65.7% recorded in 2005.
This also exceeded the federal government’s 2026 goal range of 60% to 63% under the Philippine Development Plan 2023-2028 Midterm Update Results Matrices released in May. — Justine Irish D. Tabile