TDF rates mixed anew in Wednesday’s auction

By Joann Villanueva/PNA

MANILA — The rates of the Bangko Sentral ng Pilipinas’ (BSP) Term Deposit Facility (TDF) registered mixed results on Wednesday, a day after the celebration of Chinese New Year, which is also a special non-working holiday in the Philippines.

The average rate of the seven-day facility inched up to 5.1411 percent from 5.0654 percent during the auction last January 30.

BSP offered it for PHP20 billion and received tenders amounting to PHP22.593 billion. This resulted in a marked improvement in its bid coverage ratio to 1.1297 from last week’s 0.5788

The rate of the 28-day facility also went up to 5.1788 percent from 5.1779 percent last week.

It was offered for PHP10 billion, and banks submitted total tenders amounting to PHP11.703 billion.

Bids for this week’s auction for this particular tenor were, however, lower than the PHP12.423 billion last week, thus, the drop of the bid coverage ratio to 1.1703 from 1.2423 last week.

On the other hand, the rate of the 14-day facility declined to 5.1765 percent from the previous week’s 5.1770 percent.

It was also undersubscribed after banks submitted a total of PHP16.9-billion worth of bids, lower than the PHP20 billion offering. The auction committee accepted all the tenders.

It’s bid coverage ratio dropped to 0.8450 from 0.9403 last week.
Recently, BSP Deputy Governor Diwa Guinigundo said the undersubscription in the TDF facilities was not the result of tightness in liquidity in the domestic economy. Instead, he explained that this is due to the extended holidays, not unlike what was seen in December 2018.

On Tuesday, local markets paused for the celebration of the Chinese New Year.

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