The central bank on Wednesday set a higher volume offer for the July 6 term deposit facility (TDF) auction under the Interest Rate Corridor (IRC).
Bangko Sentral ng Pilipinas (BSP) data showed that the total offer was hiked to P50 billion from the initial P40 billion offers in the previous two auctions.
Volume for the 28-day tenor was hiked to P40 billion from P30 billion, while the volume for the 7-day tenor was maintained at P10 billion.
“This is consistent with our earlier pronouncement that the volume will be scaled up gradually to ensure smooth transition to the IRC regime,” BSP Governor Amando Tetangco Jr., said in a text message to reporters.
He said the central bank continues to see ample liquidity in the system that indeed warrants an increase in the TDF volume to ensure monetary stability and sustained economic growth.
Meanwhile, the BSP on Wednesday awarded P30-billion worth of its (TDF)—P10 billion in the seven-day tenor and P20 billion in the 28-day tenor—rejecting most of the over P160 billion tenders for the liquidity management tool under the IRC.
Of the total tenders, P63.632 billion was for the seven-day term deposit, and P95.317 billion for the 28-day term deposit—far exceeding the P10 billion and P20 billion set respectively for the auction.
The offer was oversubscribed with the auction priced at an average of 2.5 percent for both tenors.