TANZANIA: DEMAND FOR ONE-YEAR TREASURY BILLS REMAINS HIGH

Demand for one year treasury bills has for the last five months since January remained higher, thanks to high liquidity level in the circulation.

Also apart from the fall of yield rates from an average 15 per cent in the first treasury bills auction in January to around 12 per cent, investors’ appetite for the government note has remained higher, registering oversubscription.

According to the Bank of Tanzania (BoT) auction summary tendered on Wednesday, a total of 137bn/- was offered to the market at 12.8 per cent weighted yield to maturity, and managed to attract bids worth 200.08bn/-.

Interest rates across all tenors declined slightly compared to the previous session, but it was not a reason that prevented investors to invest massively in the one-year treasury bills maturities.

For example, the yield rate for the 364 days offer declined to 12.99 per cent from 13.13 per cent of the previous session but it attracted bids worth 121.9bn/- against 55bn/- offered to the market.

The interest rate for the 182 days tenor went down to 12.84 per cent from 13.04 per cent of the previous auction but it pulled up bids worth 72.46bn/- compared to 45bn/- offered to the market for tendering.

However the yield rate for the 91 days offer that was cut to 10.67 per cent from 10.95 per cent of the preceding market and investors’ turnout was low after attracting only 5.70bn/- against 32bn/- offered of tendering.

Similarly, the 35 days offer remained unattractive to investors after failing to attract any bid.

The one year government note managed to attract a total of 91 number of bids but the successful were only 56. However, in the end, the government ended up taking only 105.7bn/- as successful amount.