Saturday 21 October 2023

6 month T-bill Tranche: Expect 3.85% Yield this Time

The previous T bill landed a real surprise where despite market valuing Singapore 6 month T-bills at around 4% yield, the resulting auction came in at 3.87%.

This was a result of many people who low balled in the competitive tranche with average yield of 3.37%. However, for this tranche I expect less of this low ballers as people would have learnt the lesson that too many low-balling cooks spoil the broth.

Current Market Yield

The current market yield for 6 months T bills is 3.86%

I expect with a few Singaporeans still going to low ball, this tranche of T bills results will be 3.85%.

Sadly, the effects of "tragedy of the commons" is in play; too many low ballers, and all who got the 6 month T-bills suffer. So to all: Stop low balling, bid 3.85% for all to benefit.

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