MANILA – Strong demand for the Bangko Sentral ng Pilipinas’ (BSP) term deposit facility (TDF) continues to push the facility’s rates down.
Data released by the central bank on Wednesday showed that the average rate of the seven-day facility slipped to 1.6992 percent and the 14-day facility to 1.7654 percent.
These were at 1.7097 percent for the shorter-tenor TDF and 1.7817 percent for the two-week TDF during the auction last July 14.
The BSP kept the offering for the one-week facility at PHP160 billion but tenders remained higher at PHP230.57 billion. The auction committee made a full award.
Bid coverage ratio for this tenor stood at 1.4411, higher than the 1.3498 last week when the bids amounted to PHP215.972 billion. The committee has made full awards of its offer.
Offer volume for the two-week facility was increased to PHP400 billion from the previous week’s PHP390 billion.
Tenders amounted to PHP511.241 billion, which made the auction committee fully award this tenor.
Bid coverage ratio declined to 1.2781, lower than the previous auction’s 1.3468 when tenders amounted to PHP525.252 billion.
BSP Deputy Governor Francisco Dakila Jr. cited the strong demand for TDF, adding that results of this week’s auction “continue to reflect normal market conditions amid sustained ample liquidity in the financial system.”
“Looking forward, the BSP will remain guided by its assessment of the latest liquidity conditions and market developments for its monetary operations,” he said in a statement. (PNA)