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T-bills yield drops 13bps amid huge appetite

TREASURY bill (T-bill) weighted average yield to maturity lost 13 basis points (bps) to 4.75 per cent during last week sale on back of huge investors’ appetite.

The bills yield to maturity declined from 4.75 per cent mid last week to 4.88 per cent of previous auction as the pushback by the central bank seems to have relaxed.

Orbit Securities said yesterday in its Weekly Market Synopsis that the relaxing of pushback demonstrated on the amount the central back accepted.

“The pushback by the Bank of Tanzania [BoT]  seems to have relaxed as the Bank accepted 51.37 per cent of the total offered compared to 76 per cent during the previous auction,” Orbit, the largest brokerage firm in the country, said.

The mid-last week sale saw investors’ appetite for T-bill rose to be oversubscribed by 56.87 per cent.

BoT offered the usual size of 107.2bn/- while the market tendered 168.16bn/-from 69 bids.

Tanzania Securities said instead the government accepted 86.40bn/- from 20 successful bids out of over 60 total bids received.

The weighted average yield to maturity for 35 days, 91 days, 182 days and 364 days in brackets were (2.67%), (3.20%), (3.88%), and (4.84%) in that order.

The minimum successful price for 35 days, 91 days, 182 days and 364 days was 99.74, 99.21, 98.09 and 95.25.

The oversubscription was experienced in 35 days, 91 days, 182 days and 364 days by 4.0bn/-, 3.16bn/-, 6.3bn/- and 47.5bn/- respectively.  

Zan Securities said in its Weekly Market Wrap-Ups that T-bills yield trend exhibited last week projected to affect the sale of coming T-bonds ahead as well.

“We do not expect any change in yield trend in the auction for Treasury Bonds owing to what happened in this week’s auction for the Treasury Bills,” Zan said.

For week ending last Friday for the secondary market, the government bond segment transacted 30.96bn/- with the face value of 30.19bn/- from last week's transaction value and the face value of 30.33bn/- and 30.13bn/- respectively.

The corporate bond segment remained transacted 1.96m/- with the value of 2.0m/- from previous week transaction and the face value of 58.2m/- and 65m/- respectively.

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Author: DAILY NEWS Reporter

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