MANILA – The Bangko Sentral ng Pilipinas (BSP) increased the offering for the 14-day term deposit facility (TDF) this week although it was undersubscribed.
However, the average rate of the shorter-dated facility slipped to 1.7253 percent and the 14-day facility to 1.7392 percent, BSP data showed.
These were at 1.7314 percent for the one-week tenor and 1.7486 percent for the two-week TDF during the auction last May 5.
The BSP still offered the seven-day TDF for PHP150 billion and tenders reached PHP160.199 billion. The auction committee made a full award.
Offer volume for the 14-day facility was increased to PHP370 billion, higher than last week’s PHP360 billion.
However, tenders amounted to PHP368.448 billion, which the auction committee fully accepted.
In a statement, BSP Deputy Governor Francisco Dakila Jr. said total tenders in this week’s auction is “generally consistent with the BSP’s expectations.”
He said auction results this week “continue to show that market conditions are normal amid sustained ample liquidity in the financial system.”
Dakila said the marginal undersubscription in the longer tenor could be partially attributed to market uncertainty coming from the release of the lower-than-expected first-quarter gross domestic product growth data and the BSP’s policy announcement.
The Philippine Statistics Authority (PSA) reported the -4.2 percent output of the domestic economy in the first three months this year, an improvement from the previous quarter’s -8.3 percent print but weaker than the -0.7 output in the first quarter of last year.
BSP’s policy-making Monetary Board (MB) kept the central bank’s key rates steady during its policy meeting on Thursday.
To date, BSP’s reverse repurchase (RRP) rate remains at record-low of 2 percent, the overnight deposit rate at 1.5 percent, and the overnight lending rate at 2.5 percent.
“Looking ahead, the BSP’s monetary operations will continue to be guided by its latest assessment of prevailing liquidity conditions and market developments,” Dakila added. (PNA)
