By Luz Wendy T. Noble, Reporter

The Philippine central bank sold P100 billion worth of 28-day bills on Friday, with rates slipping as it vowed to keep an accommodative stance to support economic recovery.

The Bangko Sentral ng Pilipinas (BSP) fully awarded the one-month bills that were oversubscribed, as demand hit P156.81 billion. Tenders were also higher than P139.05 billion at the auction last week.

The average rate of the short-term securities fell by 0.08 basis point to 1.7684% from a week earlier. Accepted rates were 1.7425% to 1.788%.

The central bank uses short-term securities and its term deposit facility to mop up excess liquidity in the financial system and guide market rates.

Yields on the central bank’s short-term securities fell as market participants factored in the dovish signals from the BSP, Michael L. Ricafort, chief economist at Rizal Commercial Banking Corp., said in a Viber message.

Central bank Governor Benjamin E. Diokno on Thursday said they will continue to focus on helping to firm up a stronger recovery, even when some central banks have tightened policy due to inflation concerns.

“The BSP, however, is confident that the Philippines is well-placed to recover with a possible tightening of global financial conditions,” he told an online news briefing.

Inflation topped the Philippine central bank’s 2-4% target at 4.8% in September, though this was slower than 4.9% in August.

“Continued monetary policy support remains crucial in supporting private demand and encouraging banks to lend and thereby allow the economic recovery to gain more traction,” Mr. Diokno said.

The central bank kept the policy rates at their record lows at its September policy review. Mr. Diokno earlier this week said they were unlikely to adjust policy settings until the end of the year.