Term deposit rates rise
MANILA, Philippines — Term deposit fetched higher rates as investors adopt a wait-and-see attitude with regards to the impending rate hike by the US Federal Reserve next month, the Bangko Sentral ng Pilipinas (BSP) reported yesterday.
The seven-day term deposits fetched a higher rate of 3.4054 percent compared to last week’s 3.3849 percent with accepted rates ranging from 3.325 to 3.45 percent.
On the other hand, the yield of the 28-day term deposits rose to 3.4933 percent from 3.4908 percent as accepted yields ranged between 3.46 and 3.5 percent.
The term deposit auction facility (TDF) was undersubscribed anew yesterday.
The shorter-dated term deposits were oversubscribed as bids amounted to P45.16 billion and the BSP auction committee made a full award of P40 billion.
The longer-dated term deposit offering of P90 billion was undersubscribed anew as tenders only reached P69.18 billion.
The BSP auction committee retained the volume of the weekly TDF auction at P130 billion on Nov. 22 consisting of P40 billion in seven-day term deposits and P90 billion in 28-day term deposits.
BSP Deputy Governor Diwa Guinigundo said banks continued to go more for short term in anticipation of the US Fed’s tightening bias.
The US central bank is expected to raise benchmark rates in December – the third for the year after it tweaked rates in March and June.
Guinigundo said banks are also convinced that the country’s monetary policy setting remains appropriate due to the benign inflation environment.
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