Singapore’s latest six-month T-bill offers 3.93% yield

Singapore's latest six-month Treasury bill (T-bill) closed its auction with a cut-off yield of 3.93 per cent on Thursday (Feb 16).

The latest tranche of T-bills were around 2.3 times subscribed for the S$4.9 billion allotment.

The T-bills attracted strong investor interest last year as their yield hit a 30-year high of 4.4 per cent for the six-month tenor in December, on the back of rising interest rates globally. But the yields have been falling in recent months after the US Federal Reserve signalled a slowdown in its rate-hike trajectory.

Leow noted, however, that selected banks are still offering comparable or even higher fixed deposit rates. “Savers can take the choice of which instrument is more attractive at the point where they deploy the cash,” he said.

In a T-bill auction, up to 40 per cent of the total issuance amount will first be allotted to non-competitive bids. If the amount of non-competitive bids exceeds 40 per cent, the bond will then be allocated to non-competitive investors on a prorated basis, with the balance going to competitive bids, from the lowest to highest yields.

Earlier in February, DBS started to allow investors to apply online for T-bills using their CPF Ordinary Account (CPF OA). It is currently the only local bank that accepts online applications for T-bills via CPF OA. Prior to this, investors had to apply in person at bank branches.