The central bank awarded in full the 28-day bill issue on offer Friday, with rates falling from the previous auction amid ample liquidity.

The Bangko Sentral ng Pilipinas (BSP) received tenders of P162.8 billion for the bills, less than the P167 billion in last week’s auction.

The bank has been making full awards of the bills since the maiden offering in September.

The average rate was 1.6362%, down from 1.6473% a week earlier. The range of accepted offers was between 1.6285% and 1.645%, against 1.6349%-1.66% a week earlier.

Investors are waiting out the official release of fourth quarter gross domestic product (GDP) data next week, according to Ruben Carlo O. Asuncion, chief economist at UnionBank of the Philippines.

The grim economic outlook and the Bangko Sentral ng Pilipinas’ (BSP) decision to pause on monetary easing may have forced markets to shift to short-term debt for the meantime, he said.

“Market has been moving sideways as recent indicators continue to reinforce a potential lackluster 4Q20 GDP print. BSP seems to be locked in with its declared pause even as inflation risks prevail and economic growth remains anemic. Biddish sentiment continued toward short tenors (like this one from BSP) this week due to reasons mentioned here,” he said via Viber Friday.

The Philippine Statistics Authority (PSA) will report GDP data on Wednesday. Economic managers are estimating that full-year GDP contracted between 8.5 and 9.5% last year. — Beatrice M. Laforga

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