The Philippine central bank fully听awarded听short-term bills it听sold听on Friday as rates continued to decline on ample demand as the market awaits听government听updates on听the country鈥檚听lockdown status.听
The Bangko Sentral Pilipinas (BSP) raised P100 billion听from听28-day bills as total tenders hit P144.79 billion.听The offer was 1.45 times oversubscribed,听but demand eased from P152.98 billion听at last week鈥檚 auction.听
The bills fetched an average rate of 1.721%, down by one basis point from a week ago.听Yields sought by banks听were听1.71% to 1.7305%, lower than 1.715听to听1.738%听a week earlier.听
The central bank offers short-term debt and the term deposit facility to mop up excess liquidity in the financial system.听
Bill rates听declined听again听as markets await听the听government’s decision on the quarantine classification for Metro Manila, said听Michael L. Ricafort, chief economist at听Rizal Commercial Banking Corp.听
Still, there was ample demand due to excess cash in the financial system.听
Metro Manila and other parts of the country听experiencing a spike in infections听are under a modified enhanced community quarantine听until the end of the month as the threat of听a听more contagious听Delta coronavirus variant persists.听
The Health department reported听17,447听coronavirus infections on Friday听鈥斕齮he second-highest daily tally since the pandemic started听last year 鈥斕齛mid a fresh surge spurred by the Delta variant.听
A stricter lockdown could prompt investors to flock to safe assets such as government securities and BSP’s short-term bills, pulling down bond yields.听鈥斕Beatrice M. Laforga听
