BSP bills’ rate ends flat amid oversubscription

THE BANGKO SENTRAL ng Pilipinas’ (BSP) short-term securities’ average rate was nearly flat on Friday, with demand for the offer staying strong.

Tenders for the 28-day BSP bills amounted to P80.074 billion, more than double the P30-billion offer but below the P85.659 billion in bids for the same volume auctioned off in the previous week.

This translated to a bid-to-cover ratio of 2.6691 times, lower than the 2.8553 ratio seen a week ago.

The central bank made a full award of its P30-billion offering.

Accepted yields for the one-month papers were at 4.62% to 4.749%, slightly higher than the 4.6% to 4.741% band in the previous auction. This brought the weighted average accepted rate to 4.7096%, edging up by 0.65 basis point from 4.7031% a week earlier.

The central bank uses the BSP securities and its term deposit facility to mop up excess liquidity in the financial system and to help guide short-term market yields towards its policy rate.

The BSP bills also contribute to improved price discovery for debt instruments while supporting monetary policy transmission.

In its February 2026 Monetary Policy Report, the central bank said it has limited its BSP securities offerings to a single tenor to rationalize its liquidity operations and focus on tenors that would boost monetary policy transmission.

As of mid-February, the central bank’s monetary operations have siphoned off P1.2 trillion in liquidity from the market. Of this, 28.5% was absorbed through BSP securities, while 44.4% were mopped up through the overnight reverse repurchase facility, 18.2% via the overnight deposit facility, and 9% from the term deposit facility.

The BSP significantly reduced its offers of one-month securities after the National Government on June 15 began selling cash management bills (CMBs) with 35-day and 63-day tenors weekly alongside its regular Treasury bills to help manage its funding needs.

The Bureau of the Treasury will not auction off CMBs this week. — Katherine K. Chan