After the 4.07% p.a. cut-off yield in the prior T-bill auction, I was looking forward to a possibly higher cut-off yield for this auction.
Unfortunately, the possibility of a much higher cut-off yield attracted many low-ballers, and that crushed all hopes of a higher yield.
If we look at the average yield for this auction and the auction that took place on 28 Sep, it is quite clear what happened.
This auction’s average yield is 3.37% p.a.
28 Sep’s average yield was 3.51% p.a.
There were people bidding much lower than 3.37% p.a. to secure the T-bills in this auction.
As low as 2.37% p.a.
That is just asinine.
That is even lower than what the CPF-OA pays!
The amount of interest in this auction shot through the roof as only 79% of non-competitive bids were allotted.
I hope the low-ballers are happy now that everyone ends up with a lower cut-off yield.
Reference:
4.07% p.a. T-bill.
