Africa-Press – Tanzania. THE Treasury bills were highly oversubscribed despite the central bank limiting the successful bids thus pushing some bills to yield down as investors waiting for a fresh calendar.
The Bank of Tanzania (BoT) put the usual offer of 76.7bn/- while the public tendered 133.32bn/, marking an oversubscription of 73.82 per cent.
At the end of the auction, BoT, accepted 23.5bn/- , which was six times less than the amount tendered last week. Orbit Securities said in its Weekly Market Synopsis on Tuesday that the oversubscription pushing down the weighted average yield of the 364 days tenor lost 43 basis points (bps) to settle at 4.81per cent while the 182 days slightly jumped by 1bps to 3.58 per cent.
“The Treasury bills auction held [last Wednesday] was highly oversubscribed despite the central bank limiting the successful bids while lowering one of the most indicative yields in the economy, the 364 days Treasury yield,” Orbit report said.
Also similar to the previous auction, the 35 days and 91 days tenors were cancelled after receiving zero bids. Vertex International said in its Market Review that the auction results for last week bills surpassed their expectations as it was hugely oversubscribed.
“However, that huge appetite drove down the yield on 364 bills. Investors are highly anticipating the new bond issuance schedule for the next fiscal year,” Vertex report said. Zan Securities said the auction result underscores a prevalent theme, reduced appetite for relative low yielding bonds.
“Auction results showcase the continued investors’ appetite for higher yield bills, which results in a higher return as the 364 days bill,” Zan said in its Weekly Market Wrap-Up. The debt investors are currently awaiting the start of the new auctioning for the next financial calendar, which starts with the 20 years bond, next Tuesday since Wednesday is a public holiday—Sabasaba.
“Treasury bills and bonds auctions will be issued on Wednesdays’ (alternating in each week) or another day in case of public holidays,” BoT said in a statement for the next bonds and bills calendar.
