Investors rush for oneyear treasury bills

Investors rush for oneyear treasury bills

Wed Apr 16, 2014

INVESTORS expressed high appetite in the last week’s one year treasury bills that registered oversubscription of 216.14bn/- despite a slight increment in yield rates.

According to the auction results posted by the Bank of Tanzania (BoT), the amount offered for tendering was 135bn/- but in the end of the market session, investors bids increased by 81.14bn/-, an indication of high level of liquidity in circulation.

Interest rates across all tenors increased slightly compared to the previous session, the situation that may have hooked massive investments in short-term instruments.

The weighted average yield to maturity for instance increased to 13.17 per cent from 13.02 per cent of the previous auction two weeks ago.

However, apart from the oversubscription, only 123 bids out of the total 216 succeeded, a clear indication that some investors offered price below the market value.

The bank report shows that there was a higher appetite for 364-day bills that attracted bids worth 9464bn/- against the 55bn/- initially sought at interest rates of 13.33 per cent, up from the previous yields of 13.32 per cent.

The 182-day offer was oversubscribed to 80.62bn/- against the 45bn/- offered for tendering at a rate of return of 13.22 per cent the same as preceding marked session.

The total amount tendered for the 91 day offer increased to 33.27bn/- against 30bn/- placed for tendering at 12.16 per cent rate of return compared to 12.17 per cent of the previous market.

There was no bids for the 35-day tenor where 5bn/- offered for tendering.

SOURCE: DAILY NEWS

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