Term deposit rates ease
Lawrence Agcaoili (The Philippine Star) - June 27, 2019 - 12:00am

MANILA, Philippines — The yields of term deposits eased across the board after the Bangko Sentral ng Pilipinas (BSP) decided to keep interest rates unchanged last week to assess the impact of earlier monetary actions.

The seven-day tenor fetched 4.6240 percent, slightly lower than last week’s 4.6278 percent, while the yield of the 14-day term deposits declined by 1.05 basis points to 4.7002 percent from 4.7107 percent.

The BSP did not auction the 28-day tenor.

The term deposit auction facility (TDF) was oversubscribed anew as bids amounted to P31.4 billion, higher than the issue size of P20 billion.

Banks continued to swarm the liquidity absorption facility as tenders for the seven-day term deposits reached P14.41 billion versus the P10 billion volume, while bids for the 14-day tenor amounted to P16.99 billion against the P10 billion issue size.

The BSP kept benchmark rates steady last June 20 after slashing interest rates by 25 basis points last May 9 due to easing inflation as well as slower-than-expected gross domestic product (GDP) growth of 5.6 percent in the first quarter from 6.3 percent in the fourth quarter of last year.

Aside from the policy easing, the central bank also slashed the reserve requirement ratio for big and mid-sized banks by 200 basis points in three tranches until July 26 and for small banks by 100 basis points last May 31.

BSP Deputy Governor Diwa Guinigundo had said excess liquidity is slowly finding its way into the financial system with the recent RRR reduction.

Guinigundo said banks expect inflation to further ease leading to lower interest rates.

BANGKO SENTRAL NG PILIPINAS
Philstar
  • Latest
  • Trending
Latest
Are you sure you want to log out?
X
Login

Philstar.com is one of the most vibrant, opinionated, discerning communities of readers on cyberspace. With your meaningful insights, help shape the stories that can shape the country. Sign up now!

SIGN IN
or sign in with