THE CENTRAL BANK raised P110 billion as planned via its one-month bills even as its average rate inched up following elevated US consumer inflation.

The Bangko Sentral ng Pilipinas (BSP) fully awarded its 28-day bills on Friday, with the offer oversubscribed as tenders hit P110.25 billion. However, the demand was lower than the P148.69 billion seen in the previous auction.

Accepted rates for the one-month papers ranged from 1.7475% to 2%, wider than the 1.75% to 1.7799% margin seen a week earlier. This caused the average rate of the 28-day securities to increase by 3.43 basis points to 1.7934% from 1.7591% previously.

The BSP bills and the term deposit facility are used to mop up excess liquidity in the financial system and guide market rates.

The average rate of the central bank’s short-term bills rose week on week after the multi-year high rise in the US consumer price index, Rizal Commercial Banking Corp. Chief Economist Michael L. Ricafort said in a Viber message.

The US Labor department on Wednesday reported the consumer price index rose 0.9% last month, Reuters reported. This brought the annual increase in the consumer price index to 6.2%, which was the biggest since November 1990.

The continued uptick in global oil prices also affected rates, Mr. Ricafort added. — L.W.T. Noble