The Bangko Sentral ng Pilipinas (BSP) received P685.08 billion of tenders for its two-tenor term deposit facility (TDF) auction against offer of P480 billion.
The average rate for the 7-day TDF fell by 1.522 basis points (bps) to 1.8280 percent while the 14-day rate also decreased by 1.716 bps to 1.8727 percent. “The accepted yields narrowed for both tenors and showed a marginal downward shift for the 7-day TDF, with a range of 1.700-1.850 percent, but shifted higher for the 14-day TDF, with a range of 1.700-1.892 percent,” noted BSP Deputy Governor Francisco G. Dakila Jr.
The 7-day TDF has the same offer volume of P140 billion and the 14-day with P340 billion. Both tenors were oversubscribed by 1.62x and 1.35x.
Dakila said auction bids continue to show banks’ ample liquidity and the market preference for “safe assets” amid BSP’s steady monetary policy stance and a still raging pandemic.
The TDF is one of BSP's liquidity mopping-up tool and haven for banks that are hesitant to release loans while the economy is still restricted by lockdowns.