MANILA – The rates of the Bangko Sentral ng Pilipinas’ (BSP) term deposit facility (TDF) declined Wednesday amidst oversubscription ahead of the holidays.
Data released by the central bank showed that the rate of the seven-day facility declined to 1.7292 percent and the rate of the 14-day facility to 1.7261 percent.
These were at 1.7479 percent and 1.7326 percent for the seven- and 14-day TDF during the auction last November 25.
The BSP offered the shortest tenor TDF for PHP180 billion and tenders amounted to PHP208.985 billion.
The bid coverage ratio rose to 1.1610 from last week’s 1.1384 after the PHP170 billion offer in the previous auction was met with PHP193.53 billion worth of tenders.
Tenders for the 14-day facility reached PHP399.431 billion, higher than the PHP300 billion offer.
The bid coverage ratio slipped to 1.3314 from last week’s 1.4086 when this facility was offered for PHP290 billion and bids amounted to PHP408.5 billion.
BSP Deputy Governor Francisco Dakila Jr., in a statement, said results of this week’s TDF auction “indicate increased preference among market participants for the shorter tenor, possible in view of the holiday season.”
“The BSP’s monetary operations will continue to be guided by its assessment of market developments and liquidity conditions going forward,” he added. (PNA)