The Bangko Sentral ng Pilipinas (BSP) offered P110 billion of 28-day BSP bills for the second week and it was oversubscribed by 1.25x at P137.82 billion.

Peso bills

BSP Deputy Governor Francisco G. Dakila Jr. noted there was “good demand” from banks with a bid coverage ratio of 1.2529 which was lower than September 3 of 1.3459.

Last week’s tenders were however higher at P148.05 billion or 1.35x more than the offering.

Dakila said the weighted average interest rate decreased by 0.128 basis point to 1.7181 percent. “The yields accepted shifted lower and widened to a range of 1.7000-1.7415 percent,” he said.

Dakila said auction results “continue to show that market conditions remain normal, supported by ample liquidity in the financial system.”

The BSP raised the securities facility volume last week by P10 billion. It was the first time since April this year that the offering was increased.

The highest offering for this year was P120 billion last February. The central bank reduced the offer size to P70 billion in March when the second phase of the enhanced community quarantine was imposed.

The BSP bills help regulators control inflation by mopping up excess liquidity. Through its anti-pandemic measures, the BSP has injected about P2.3 trillion of bank liquidity into the financial system since March 2020.

Source: Manila Bulletin (