TDF rates post mixed results amid strong demand

TDF rates post mixed results amid strong demand

MANILA – The rates of the Bangko Sentral ng Pilipinas’ (BSP) term deposit facility moved to different ways anew this week despite the strong demand for the facilities.

Data released by the central bank showed that the average rate of the seven-day facility rose again and ended the day at 1.7375 percent while the rate of the 14-day facility declined to 1.7448 percent.

These were at 1.7154 percent for the one-week TDF and 1.7486 percent for the two-week TDF during the auction last July 28.

The BSP decreased by PHP10 billion the offer volume for the seven-day facility to PHP160 billion but tenders reached PHP185.592 billion. The auction committee made a full award.

This resulted in a bid coverage ratio of 1.1600.

The two-week facility was also oversubscribed after bids amounted to PHP457.988 billion, higher than the PHP400-billion offer, same as last week’s volume. This tenor was also fully awarded.

Bid coverage ratio stood at 1.1450.

In a statement, BSP Deputy Governor Francisco Dakila Jr. said results of the TDF auction this week “are in line with what was observed in the primary GS (government securities) market.”

He also attributed the increase in the seven-day TDF to the results of last week’s auction.

Dakila said despite the reimposition of stricter quarantine measures on Aug. 6 to 20, market conditions remain normal amid continued ample financial liquidity.

“Looking ahead, the BSP’s monetary operations will continue to be guided by its assessment of the latest liquidity conditions and market developments for its monetary operations,” he added. (PNA)

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