The Bangko Sentral ng Pilipinas (BSP) recorded a decline in the yield for its 28-day securities during this week's auction, driven by sustained strong appetite from investors for short-term government debt.
Key Auction Results Show Yield Compression
In its auction held on Friday, December 5, 2025, the central bank announced that the weighted average interest rate (WAIR) for the 28-day BSP bill settled at 4.9461 percent. This marks a notable decrease of 6.45 basis points compared to the rate from the previous week's offering.
The BSP maintained its offer volume at PHP 90 billion. Investor interest, however, far exceeded this amount, with total tenders reaching PHP 137.4 billion. This robust demand resulted in a bid-to-cover ratio of 1.53, a key indicator of the high liquidity present within the country's financial system.
Full Award and Yield Range
Given the overwhelming market participation, the monetary authority fully awarded the entire PHP 90 billion offering. The accepted yields for the 28-day tenor ranged from 4.9000 to 4.9900 percent, which was a slightly wider band compared to the range observed in the prior auction.
This week's strong bidding activity presents a clear contrast to the more moderate turnout seen just a week earlier. Data from the November 28 auction reveals a different picture for the 27-day BSP bill offered at that time.
Comparing Week-on-Week Performance
During the November 28 auction, the BSP also set an offer volume of PHP 90 billion. However, total bids were significantly lower at PHP 101.405 billion. The central bank awarded only PHP 81.405 billion of that amount, leading to a substantially lower bid-coverage ratio of 1.1267.
The weighted average accepted yield for that previous 27-day bill was also higher, settling at 5.0106 percent. The notable week-on-week improvement in demand and the consequent yield drop highlight shifting investor sentiment and preference for the central bank's short-term instruments.
The results underscore the ample peso liquidity in the market and continued investor confidence in the BSP's securities as a safe haven for short-term funds.
