According to the auction results released by the Monetary Authority of Singapore (MAS) on Thursday (February 13), the cut-off yield for Singapore's latest six-month Treasury bill (T-bill) has dropped to 2.9%.

This rate is lower than the 3.04% recorded in the previous six-month auction that concluded on January 28.

The auction raised a total of SGD 7.3 billion, but the total amount of applications received was as high as SGD 23.3 billion, resulting in a bid-to-cover ratio of 3.19, indicating increased demand for the latest round of bonds.

In comparison, the previous auction received applications totaling SGD 15.3 billion, with a bid-to-cover ratio of 2.13.

The average yield in the latest auction was 2.78%, down from 2.97% in the previous auction.

The average yield decreased from the previous 2.69% to 2.52%.

Approximately 80% of non-competitive bids were allocated, amounting to SGD 2.9 billion, while about 29% of competitive bids at the cut-off yield were allocated.

Singapore will issue up to an additional SGD 450 billion in government bonds, following a parliamentary motion passed in November last year to raise the government bond issuance ceiling from the previous SGD 1.065 trillion to SGD 1.515 trillion. The new ceiling is expected to remain in place until 2029.

It is anticipated that over 60% of the additional SGD 450 billion will be issued in the form of Special Singapore Government Securities to meet the investment needs of the Central Provident Fund. The remainder will be used for issuing Singapore Government Securities (Market Development), Singapore Savings Bonds, and Treasury bills.