LONDON, HONG KONG - Orders for the Philippines' $1 billion 25-year bond total $4.5 billion so far and pricing is expected in the New York morning session, a fund manager said on Friday.

The strong demand for the bond allowed the country to raise the deal size to $1 billion, the upper end of the earlier $750 million to $1 billion range.

The Philippines, one of Asia's most active sovereign debt issuers, has lowered the yield it will offer investors after its global bond issue, its third sale this year, attracted solid demand within hours of its opening.

It now plans to offer investors between 6.425% and 6.475%, below the earlier indication of around 6.5%.

"They have not left a lot on the table but the Philippines always has high demand and they have been road-showing extensively for weeks and weeks," said a London-based fund manager.

"The curves are crowded at the front end and issuers want to lock in low finance for a long period," he said referring to the new proposed 2034 bonds which will be the longest dated global bonds from Philippines.

Deutsche, HSBC and UBS are lead managers of the bond.

The country sold $1.5 billion in 2019 bonds at 8.5% in January and $750 million 2020 bonds at 6.625% in July.

Standard and Poor's has rated the deal BB-minus, Fitch Ratings has assigned a BB rating and Moody's Investors Service has rated it Ba3.

The Philippines wants to secure financing for its 2010 budget deficit ahead of presidential polls in May, with markets likely to be edgy about policies to be pursued by the new administration.

This political uncertainty and a record high deficit, which could be exceeded because of a slowing economy and reconstruction costs after devastating typhoons, are starting to cause unease.

"It is a bit worrying that the fiscal deficit number gets revised up multiple times, with continued disappointment in revenue collection," said Nomura International's Hong Kong-based credit analyst Yang-Myung Hong.

"Hence, the medium-term trend remains uncertain, especially given next year is an election year with added political uncertainty," he said.

Finance Secretary Margarito Teves said on Wednesday the government was keen to tap the overseas debt market to pre-fund some of its 2010 foreign debt needs of around $2 billion.

Overnight, Sri Lanka sold $500 million in 5-year dollar bonds at a yield of 7.4% after the issue generated orders of $6.8 billion.