Asia FX and Rates Strategy: Auction Preview: China, Philippines, Thailand, Indonesia, India

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Asia FX and Rates Strategy: Auction Preview: China, Philippines, Thailand, Indonesia, India

Asia FX and Rates Strategy

27 July 2026 Citi Research

For one, our previous discussions on our trip suggested a limit of 15% debt

maturing <1y of outstanding to manage refinancing risks. Our estimates of

outstanding (LCY only) bonds/bills maturing <1y out of total central government

debt outstanding was already 14% (as of May) which can cap any further upsizing

or reliance of bills. Foreign currency bonds at PHP 315bn total issuance vs

budgeted PHP 302bn suggest completion on this front too, with gross and net

external financing YTD (as of Jun) already at 87% and 94% completed respectively.

This compares to the gross and net domestic financing completion rate of only 62%

and 55% respectively, which can leave the RPGB curve vulnerable to a step-up in

local bond supply once geopolitics improves (or even worse if uncertainty/weak

demand sustains) and even the possibility of a jumbo offering in coming months

(we suspect Sep/Oct if happens, given the redemption profile). Accordingly, we stay

neutral on Philippines duration for now.

Thailand: Strong auction seen through July, but sustained interest remains

uncertain. Contrary to our prior expectations, ThaiGBs have seen notable auction

strength persist through July. This is especially so in the back-end where 25y and

30y auctions saw highest bid-to-cover ratios in recent 12m history. Rest of tenors

were also mostly above their respective 12m medians, with consistent signs of

decent demand seen in the 3y-5y sectors too. Looking ahead, however, we are

reluctant to turn too constructive on ThaiGBs here for a few reasons still: 1) Bonds

have already been significantly outperforming swaps across the curve since end