THE BANGKO SENTRAL ng Pilipinas (BSP) fully awarded the short-term securities it auctioned off on Friday as global oil prices continued to decline.
The central bank raised P100 billion as planned from its offer of 29-day bills that attracted P126.25 billion in tenders. Demand was lower than the P130.51 billion seen last week.
Accepted rates for the one-month debt ranged from 1.65%-1.8%, wider than the 1.76% to 1.805% margin last week. The average rate for the one-month securities was at 1.7699%, lower than 1.7798% last week.
The central bank uses its short-term securities and term deposit facility to mop up excess liquidity in the financial system and guide market rates.
The BSP bills’ yield slightly eased as global prices declined to one-and-a-half month lows after the United States and other countries released their petroleum reserves, Michael L. Ricafort, chief economist at Rizal Commercial Banking Corp., said in a Viber message.
Oil prices declined on Friday amid concerns of a global surplus after the US, China, India, and Japan released oil reserves, Reuters reported. Brent crude futures fell 2.1% to $80.53 per barrel, while US West Texas Intermediate crude declined 2.6% to $76.35 a barrel.
The securities’ average yield also declined after the country recorded a narrower budget deficit last month, Mr. Ricafort added.
Preliminary data from the Bureau of the Treasury showed the country’s fiscal gap stood at P64.3 billion in October, or 4.77% higher than a year ago. This was 64.46% lower than the P180.9-billion deficit in September and was the lowest since the P44.4-billion gap in April.
The budget deficit reached P1.2 trillion in the first ten months, 27.94% higher than the shortfall in the same period last year. — Jenina P. Ibanez
