The Bangko Sentral ng Pilipinas’ short‑term securities posted a higher average yield on Friday, while investor demand remained robust.
Bids for the 28‑day bills reached P80.24 billion, double the P40 billion offered, and slightly exceeded the P80.074 billion tendered for a P30 billion issue the week before.
The bid‑to‑cover ratio fell to 2.006 times, down from 2.6691 times a week earlier, indicating a modest easing in relative demand.
Despite the lower ratio, the central bank awarded the full P40 billion allocation, reflecting continued confidence in its liquidity tools.
Accepted rates for the one‑month securities ranged from 4.70% to 4.74%, a narrower band than the previous week’s 4.62% to 4.749%. The weighted‑average yield rose 2.04 basis points to 4.73% from 4.7096%.
The BSP uses these securities and its term‑deposit facility to absorb excess liquidity and steer short‑term market yields toward the policy rate.
These bills also enhance price discovery for debt instruments and reinforce the transmission of monetary policy.
Weekly auctions began in 2020 with a 28‑day tenor, expanded to include a 56‑day bill in 2023, and now focus on a single tenor to streamline liquidity operations and improve policy transmission.
The June 2026 Monetary Policy Report shows that open‑market operations have withdrawn P1.3 trillion from the financial system, with 19.2% absorbed through BSP securities, 52.3% via the overnight reverse‑repurchase facility, 21.5% through the overnight deposit facility, and 6.9% from the term‑deposit facility.
