Banks skewed toward shorter-term deposits on Wednesday, as bids were oversubscribed in the seven-day and 28-day facilities during the week.
Data from the Bangko Sentral ng Pilipinas (BSP) showed the banks’ preference in the shorter-termed liquidity facility, with the seven-day facility getting the highest volume of bids during the week.
Tenders in the seven-day facility hit P47.03 billion, surpassing the P40-billion volume offered for the week.
Oversubscription was also seen in the BSP’s 14-day term-deposit facility (TDF) as bids reached P31.3 billion, over the P30-billion cap offered by the BSP for the week.
For the 28-day facility, bids reached only P17.93 billion, a few billion pesos under the P20 billion offered by the BSP for the week.
BSP officials earlier said the Monetary Board could “subtly” change their monetary-policy direction without necessarily changing the main policy rate by allowing the market determined TDF rates to rise or fall.
The BSP does this by altering auction volumes.
Just last week the BSP decided to cut the volume of its seven-day and 14-day TDF. The 28-day TDF remained unchanged.
Rates of all three TDFs are near 3.5 percent during the week.
The BSP also retained its volume of offering for all three tenors for the week. In particular, seven-day TDF remains at P40 billion, while 14-day TDF offering is still at P30 billion and 28-day TDF volume is at P20 billion.