The auction of the Bangko Sentral ng Pilipinas (BSP) securities or bills continued to be oversubscribed along with the downtrend in rates.

BSP bills auctioned reached with P114.18 billion worth versus offer of P80 billion. The average rate for the 28-day BSP bills are still on the downtrend, it fell to 1.8795 percent from 1.9156 percent last week.

 BSP Deputy Governor Francisco G. Dakila Jr. noted continued strong demand with a bid coverage ratio of 1.4272.

 “The weighted average interest rate continued to decline, settling to 1.8795 percent which is lower by 3.611 bps (basis points) from the previous week’s rate. (But the) total tenders amounted to P114.18 billion, about 1.43x the volume offering,” said Dakila.

 He also noted that yields accepted shifted lower to a range of 1.850 percent to 1.905 percent from 1.870 percent 1.945 percent previously.

 “The results of the BSP bill auction support the view that, amid ample liquidity in the system, market participation continues to normalize following the Lenten holidays,” said Dakila.  Since its first introduction in September last year, the BSP’s securities facility is only offering the market-preferred 28-day tenor. It cancelled the 28-day term deposit facility in favor of the BSP bills.

Source: Manila Bulletin (