The Bangko Sentral ng Pilipinas said Friday it will start offering 56-day BSP bills on June 30, 2023 as part of ongoing initiatives to enhance its monetary operations under the Interest Rate Corridor framework.
The 56-day BSP bills, an additional tenor under the BSP Securities Facility, will be offered alongside the 28-day BSP bills.
It said similar to the 28-day BSP bills, the 56-day BSP bills will be offered via auction to eligible counterparties, with the volume initially set in small amounts before being gradually scaled up as market liquidity conditions allow.
The initial offer volume for the 56-day BSP bills will be announced two days before the inaugural auction on June 30 consistent with the current practice for the 28-day BSP bills.
“The introduction of the 56-day BSP bill expands the range of BSP’s term instruments and increases the BSP’s flexibility to respond to changing liquidity conditions while providing additional guidance to short-term market interest rates,” it said.
“Its introduction supports the BSP’s efforts towards a more flexible and market-based approach to managing liquidity in the financial system, in line with its overall thrust to promote price and financial stability,” it said.
BSP securities are monetary instruments issued by the BSP for its monetary policy implementation and liquidity management operations to steer short-term market interest rates towards the policy rate and influence liquidity conditions in the financial system.
With the passage of Republic Act 11211, which amended R.A. 7653 (The New Central Bank Act), the BSP’s authority to issue its own debt securities as part of its instruments for regular monetary operations has been restored.