BANGKO SENTRAL BONDS SET

The Bangko Sentral ng Pilipinas (BSP)  will auction next week 28-day BSP Bills with an indicative offer volume of about P20 billion.

However, the indicative volume is still subject to confirmation two days before the actual auction date which is scheduled on September 18.

BSP's entry into the bond market followed the changes made in its charter and is set to be part of the monetary tools open to the monetary agency in its management of inflation and the economy. 

The BSP  Securities (Bills and Bonds) is part of its initiative to shift to more market-based monetary operations. BSP Bills and Bonds will be offered via auction. The auction volumes will be small at the outset, to be gradually scaled up depending on market response and consistent with liquidity forecasts.

The inclusion of BSP Securities issuance in the standard monetary operations of the BSP provides an additional instrument for managing liquidity in the financial system and support the implementation of monetary policy under the Interest Rate Corridor (IRC) framework. 

The issuance of BSP Securities is part of the operational enhancements to the IRC framework and does not represent a change in the BSP’s monetary policy stance. 

Moreover, the issuance of securities by the BSP will add to the existing supply of risk-free financial instruments in the banking system, which in turn could help in the development of the local bond market.

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