BSP bills rates hold steady as auction volume cut

The Bangko Sentral ng Pilipinas (BSP) kept weighted average interest rates for its bills steady in the 15 August auction, even as it slashed the total volume offering to P120 billion from P200 billion.

The 28-day BSP bill (BSPB) rate edged up by 0.76 basis point to 5.3928 percent, while the 56-day tenor slipped by 0.69 basis point to 5.3902 percent. Both maturities were offered equally at P60 billion each, down from P100 billion the previous week.

Total tenders dropped to P115.207 billion from P163.236 billion previously, with the 28-day tenor undersubscribed at a bid-to-cover ratio of 0.74x, while the 56-day offering was 1.18x oversubscribed.

The central bank partially awarded P43.231 billion of the P44.231 billion in total bids for the 28-day tenor, while fully awarding the 56-day offering.

Accepted yields for the 28-day bills widened to a range of 5.2950 to 5.4300 percent, while the 56-day range narrowed to 5.3500 to 5.4000 percent.

The BSP uses its securities facility to absorb excess liquidity in the financial system, helping guide market interest rates in line with its monetary policy stance.