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Philippines: Term deposit yields higher
MANILA, Philippines — Term deposits yielded higher rates across the board on Wednesday amid the strong inflows of funds into the financial system as easing inflation and dovish US Federal Reserve give the Bangko Sentral ng Pilipinas (BSP) more room to ease policy stance.
The yield of the seven-day tenor inched up by 1.74 basis points to 4.5640 percent from last week’s 4.5466 percent, while the 14-day term deposit fetched 4.6148 percent, 2.17 basis points higher than 4.5931 percent.
Likewise, the yield of the 28-day tenor inched up to 4.6492 percent from 4.6407 percent last week.
Funds continued to flow into the Philippines amid pronouncements made by Bangko Sentral ng Pilipinas Governor Benjamin Diokno about the possibility of rate cut in the third quarter amid easing inflation as well as the dovish US central bank.
Banks continued to park their excess liquidity with the BSP, swarming the term deposit auction facility (TDF) as bids reached P88.9 billion, higher than the upsized P80-billion offering.
Tenders for the seven-day term deposits amounted to P37.49 billion versus the issue size of P30 billion, while bids for the 14-day tenor reached P30.89 billion compared to the P30-billion volume.
On the other hand, tenders for the 28-day term deposits amounted to P20.52 billion or slightly above the P20-billion issue size.
The BSP auction committee has raised the volume of the liquidity absorption facility over the past four weeks to P80 billion this week from P20 billion last June 26.
Source: https://www.philstar.com/business/2019/07/18/1935531/term-deposit-yields-higher#LHVHFWhOJDJCiljS.99