With an anticipated lower demand for the central bank’s securities facility this week, the Bangko Sentral ng Pilipinas (BSP) only offered P200 billion of BSP bills compared to P230 billion in the previous auction.
On Monday, Nov. 4, the BSP received P137.154 billion total tenders, lower than last week’s P189.788 billion.
The BSP offered P100 billion for the 28-day tenor versus P110 billion previously, while the 58-day BSP bills were also auctioned off at P100 billion, lower than last week’s P120 billion.
BSP Deputy Governor Francisco G. Dakila Jr. said Monday that the total tenders of P137.154 billion represents a bid-to-cover ratios of about 0.6x for the 28-day BSP bills, and 0.8x for the longer dated 58-day.
The BSP accepted P59.505 billion tenders for the 28-day BSP bills and P77.649 billion for the 58-day maturity.
Dakila said the weighted average interest rate for the 28-day tenor increased by 4.72 basis points (bps) to 6.3451 percent. The WAIR for the 56-day BSP bills also rose by 4.84 bps to 6.3472 percent.
“Meanwhile, the range of accepted yields narrowed to 6.2300-6.4480 percent for the 28-day BSPB (BSP bills) and to 6.2500-6.4250 percent for the 58-day BSPB,” said the BSP official.
The BSP first introduced the BSP bills in September 2020 to respond to the excess liquidity during the height of the pandemic. The securities facility is the central bank’s primary liquidity-mopping up tool, along with the term deposit facility.