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Following the most recent increase in the BSP rate, TDF rates have increased.

The rate of the term deposit facility (TDF) of the Bangko Sentral ng Pilipinas (BSP) increased on Wednesday as a result of the off-cycle 75 basis point hike in the central bank’s benchmark rates last week.

The seven-day facility’s average rate increased to 3.2459 percent, and the 14-day facility’s to 3.3417 percent.

During the auction on July 13 of last year, these were at 2.6838 percent for the seven-day TDF and 2.7235 percent for the fourteen-day TDF.

The BSP maintained the offer volume at PHP160 billion for the one-week TDF and PHP170 billion for the two-week facility. Both had an insufficient interest.

While bids for the longer-dated facility reached PHP169.618 billion, those for the shorter-tenor facility were PHP151.948 billion. The auction committee accepted each and every bid in its entirety.

TDF is one of the measures the BSP uses to remove extra liquidity from the financial system.

The results of the auction “suggest that there has been a partial pass-through of the policy rate to market rates amid abundant overall liquidity in the financial system,” BSP Deputy Governor Francisco Dakila Jr. said in a statement.

He continued, “Going forward, the BSP’s monetary operations will continue to be informed by its assessment of the most recent market developments and liquidity conditions.

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