Singapore’s 6-month T-bill yield bounces up to 3.73%

THE latest issue of Singapore’s six-month T-bills, issued by the Monetary Authority of Singapore, posted interest rates of 3.73 per cent.

This is a slight rebound from last month’s low of 3.7 per cent.

Demand for this tranche’s T-bills was the same as last month, with a bid-to-cover ratio of 2.03 as the total amount that was applied for reached S$11.2 billion, against a total of S$5.5 billion allotted.

Of the allotted T-bills, S$1.6 billion was allotted to non-competitive applications. All who applied non-competitively were allotted.

Approximately 55 per cent of those who made a competitive application at the cut-off were allotted, up from last month’s 29 per cent.

Interest rates for the T-bills have been on the rise in the last 12 months.

At 3.73 per cent, this is higher than the 2.99 per cent posted in September last year.

The highest cut-off yield for T-bills in the 12-month period was 4.4 per cent – for the tranche announced in December 2022.

Eugene Leow, senior rates strategist at DBS, thinks the interest rate for the T-bills is likely to settle at such levels for the immediate few months.

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“There may be modest upside risks if the Fed hikes once more, against our and the market’s expectations, but we do not think it would be meaningful,” he said.