Yields for 12-month T-bill rebounds to 3.74% in July

Yong Hui Ting

Yong Hui Ting

Published Thu, Jul 27, 2023 · 04:31 PM
    • The median yield for the 12-month T-bill was 3.5 per cent, and the average yield, 3.09 per cent.
    • The median yield for the 12-month T-bill was 3.5 per cent, and the average yield, 3.09 per cent. PHOTO: BT FILE

    YIELDS on the latest 12-month treasury bills (T-bills) rose to 3.74 per cent, according to the auction results issued on Thursday (Jul 27).

    This is higher than the cut-off yield for the 12-month T-bills issued in April, which stood at 3.58 per cent per annum, but lower than the 3.87 per cent posted in January this year. A total of S$4.4 billion in 12-month T-bills were allotted, out of a total of S$9.3 billion applied for. All non-competitive applications were allotted.

    The median yield was 3.5 per cent, and the average yield, 3.09 per cent.

    In a non-competitive bid for these short-term Singapore Government Securities, the investor specifies only the amount to invest and accepts the cut-off yield.

    In competitive bids, investors look to invest only if the yield is above a certain level.

    Demand for the one-year T-bills have come off from the previous round in April, which was nearly three times subscribed.

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    The latest issuance however, had a bid-to-cover ratio of 2.11.

    However, amid tight Singapore dollar liquidity, the size of the one-year T-bills issuance has expanded gradually.

    This month’s issuance was the largest in the year to date.

    This comes after the Fed on Wednesday raised rates by a quarter point to a target range of 5.25 per cent to 5.5 per cent – the highest in 22 years.

    Bond yields in the US promptly dropped, with the two-year US yields falling to 4.84 per cent.

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