Banks and trust entities swarmed the P110 billion worth of term deposits auctioned by Bangko Sentral ng Pilipinas Wednesday, the biggest amount since June 8.
Data showed the seven-day P10-billion deposit offering attracted total bids of P35.2 billion, with a weighted average accepted yield of 2.5 percent, matching the floor rate in the overnight deposit facility.
The month-long P100-billion deposits put on auction block drew total tenders of P187.489 billion and fetched a weighted average accepted yield of 2.55 percent.
The amount offered to the public Oct. 5 was the biggest since Bangko Sentral started the weekly auction on June 8 this year.
Bangko Sentral Governor Amando Tetangco Jr. said in a text message the regulator would need more data points on the TDF auctions before it could make any adjustment in the reserve requirements of banks.
“While these are important, the TDF results are not the only factor to consider for a change in the RR. The outlook on inflation, any brewing pressures in other segments of the financial market are some of the other factors,” Tetangco said.
“There is no black box for this… it is just a matter of timing,” he said.
Tetangco earlier said the auction results continued to be in line with the regulator’s expectations. “And so there does not seem to be need right now to make refinements to the path of gradual upward adjustment in auction sizes that are in the pipeline,” he said.
Bangko Sentral adopted the interest rate corridor system in June in a bid to improve the transmission of monetary policy through calibrated auctioning.
Continuous oversubscription from banks and trust entities encouraged Bangko Sentral to increase for the fourth time beginning Oct. 5 by another P20 billion the weekly volume in the TDF auction, or from the previous P90 billion to P110 billion.
The seven-day tenor deposits continue to account for P10 billion, but deposits with a month-long tenor was increased to P100 billion from P80 billion.
Bangko Sentral earlier increased the volume three times since June, from the original P30 billion to P50 billion, P70 billion and P90 billion.
Bangko Sentral Deputy Governor Diwa Guinigundo earlier said the size of future increases in the volume of auctions might vary. The four increases in auction size amounted to P20 billion each. “There is no pattern for the increases,” Guinigundo said.