Latest Singapore 6-month T-bill cut-off yield falls to 3.65%
This is down from the 3.7% offered in the previous six-month auction
THE latest Singapore six-month Treasury bill (T-bill) is offering a cut-off yield of 3.65 per cent, auction results released by the Monetary Authority of Singapore on Thursday (May 23) indicated.
This is down from the 3.7 per cent offered in the previous six-month auction, which closed on May 9.
“Bidding statistics – cut-off yield, median yields and average yield – point to investors being more willing to accept lower rates, thereby accounting for the high percentage of competitive applications being allotted,” said Eugene Leow, senior rates strategist at DBS.
The median yield offered in the latest auction fell to 3.48 per cent, from 3.55 per cent in the previous auction, while the average yield slipped to 3.04 per cent, from 3.13 per cent previously.
“This comes despite a weakening in the bid-to-cover ratio,” Leow added.
Demand fell in the latest tranche, with applications totalling S$14.5 billion for the S$7 billion on offer, representing a bid-to-cover ratio of 2.07.
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The previous auction received a total of S$16.3 billion in applications for the S$6.8 billion on offer, representing a bid-to-cover ratio of 2.4.
In the latest auction, 100 per cent of non-competitive applications, totalling S$2.7 billion, were allocated.
About 90 per cent of competitive applications at the cut-off yield were allotted.
T-bill yields hit a 30-year high of 4.4 per cent in December 2022 amid the high-interest-rate environment.
Markets initially looked forward to more rate cuts this year, but have since dialled back on expectations due to persistently high inflation figures in the US.
Yields have mostly hovered around the 3.7 to 3.8 per cent range since end February this year, after slipping to 3.54 per cent in the six-month auction that closed Feb 1.
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