UPTICK. The average rate of the central bank's term deposit facility rose anew on Wednesday (Dec. 21, 2022), which Bangko Sentral ng Pilipinas (BSP) Deputy Governor Francisco Dakila Jr. said tracked the rise in the central bank's key policy rates. This, as inflation is expected to remain elevated in the near term. (Photo courtesy of BSP)
MANILA – Demand for the Bangko Sentral ng Pilipinas’ (BSP) term deposit facility (TDF) remained strong although yields again rose on Wednesday.
The average rate of the seven-day facility rose to 6.2466 percent from 6.1395 percent during the auction last Dec. 14.
The average rate of the 14-day TDF increased to 6.3323 percent from last week’s 6.2471 percent.
The BSP lowered the offer volume for both tenors and tenders exceeded the offering.
Bids for the seven-day facility amounted to PHP179.272 billion, higher than the PHP150 billion offer, which was lowered from last week’s PHP160 billion.
The auction committee made a full award.
Tenders for the two-week TDF reached PHP147.112 billion, surpassing the PHP110 billion offer, which was reduced from last week’s PHP160 billion. This tenor was also fully awarded.
In a statement, BSP Deputy Governor Francisco Dakila Jr. said bids for the TDF in this week’s auction are “higher than the BSP’s expected volume range.”
In terms of the yields, he said the accepted range “continued to shift higher but narrowed to a range of 6.0000-6.3500 percent in the seven-day TDF and 6.0000- 6.4875 percent in the 14-day TDF.”
“The results of the TDF auction reflect the partial pass-through of the BSP policy rate hike last week amid ample liquidity in the financial system,” he said, referring to the 50 basis points increase in the central bank’s key policy rate.
The hikes in the BSP’s key rates were made after monetary authorities said inflation is expected to remain elevated in the coming months.
“Looking ahead, the BSP’s monetary operations will remain guided by its assessment of the latest liquidity conditions and market developments,” Dakila added. (PNA)
