Early December 2022 T-Bill: 4.4% P.A. Yield, Highest in Decades
After giving relatively disappointing yields the past two times, the early December treasury bill (BS22124H) hit a high in some 34 years with a cut-off yield of 4.4% p.a. The total amount allotted was S$4.6 billion, and the total amount applied was S$9.3 billion.
Non-competitive bids get the cut-off yield of 4.4% p.a. and have been fully filled.
Competitive bids above 4.4% p.a. will not get any allotted, while those under 4.4% p.a. will be fully allotted.
Tap here to read more about how bidding works.
This tranche was less popular
With just S$9.3 billion applied compared to the previous tranche’s S$11.9 billion, this t-bill is less popular, ostensibly due to the lower cut-off yield of the the past two t-bills. It could also be that savings accounts have caught up and in fact overtaken t-bills; OCBC 360 account now offers up to 4.65% p.a, and UOB recently revised its UOB One account to give 5.00% p.a effective interest rate. Fixed deposits are also giving attractive interest rates, and arguably offer better liquidity than t-bills. I maintain a page for Savings-related products and promos if you want to check it out.
Perhaps, it could also be that some people saw the relatively disappointing rates of the previous two tranches and decided not to bid at all. Ironically, this new high rate may cause people to flock back to the t-bills, causing the next one (auction date 20th December) to drop in yield when people put in lowball bids.
My prediction is that the next t-bill’s yield will drop slightly – 4.2% I’m guessing – and we’ll check back in two weeks to see if I’m right.
In any case I am happy with the 5% p.a. rate I am getting from UOB One Account, and getting an added cash bonus by earmarking my funds under their promo. I intend to write an article to analyse the earmark promo in greater detail, so stay subscribed to the Telegram for updates.
Keep up to date on the best cashback/mile cards, financial products, attractive deals, and more tips to maximise your financial wellbeing by subscribing to my Telegram channel.
Subscribe to the channel, then join the group chat. You would often benefit from the tips shared exclusively in the group chat!
Disclaimer: I may receive an affiliate/referral fee when you sign up for services/products on this site, and such fees keep the site running. I would only recommend services/products I would personally use or recommend to my own friends and family, but I do not provide any warranty or guarantee for the quality of these services/products. Thank you for supporting my site!
Please exercise due diligence when signing up for any service/product as I will not be liable for any personal loss, financial or otherwise. Content published here are my sole views and personal opnion, and none of the information here constitutes personal financial advice nor represents the views of my employer(s).