MANILA – The rates of the Bangko Sentral ng Pilipinas’ (BSP) term deposit facility declined on Wednesday on strong demand due to the high liquidity situation in the economy.
Central bank data show that the average rate of the seven-day TDF, which is among the central bank’s excess liquidity mopping tools, moved to 1.7430 percent and the 14-day facility to 1.7696 percent.
These were at 1.7521 percent for the one-week facility and 1.7723 percent for the two-week facility during the auction last October 27.
The BSP hiked by PHP10 billion the offer volume for both tenors this week to PHP170 billion for the one-week and PHP330 billion for the two-week facility. Both were oversubscribed and fully awarded.
Tenders for the seven-day facility amounted to PHP247.573 billion, resulting in a bid coverage ratio of 1.4563.
Bids for the 14-day TDF reached PHP394.209 billion, bringing the bid coverage ratio to 1.1946.
BSP Deputy Governor Francisco Dakila Jr. has repeatedly attributed the oversubscription in most of the TDF’s weekly auctions to ample liquidity in the domestic economy.
“Moving forward, the BSP’s monetary operations will remain guided by its assessment of the latest liquidity conditions and market developments,” he said. (PNA)
