{"id":2187,"date":"2023-09-15T14:00:08","date_gmt":"2023-09-15T06:00:08","guid":{"rendered":"https:\/\/www.wealthfor.us\/article\/?p=2187"},"modified":"2026-10-25T13:40:54","modified_gmt":"2026-10-25T05:40:54","slug":"t-bill-19-sep-2023-bs23118s-cut-off-yield-rebounded-to-3-73","status":"publish","type":"post","link":"https:\/\/www.wealthfor.us\/article\/t-bill-19-sep-2023-bs23118s-cut-off-yield-rebounded-to-3-73\/","title":{"rendered":"T-Bill 19 Sep 2023 (BS23118S) Cut-Off Yield Rebounded to 3.73%"},"content":{"rendered":"<p><span style=\"font-weight: 400;\">The <\/span><a href=\"https:\/\/www.mas.gov.sg\/bonds-and-bills\/auctions-and-issuance-calendar\/auction-t-bill?issue_code=BS23118S&amp;issue_date=2023-09-19\" target=\"_blank\" rel=\"noopener\"><span style=\"font-weight: 400;\">cut-off yield<\/span><\/a><span style=\"font-weight: 400;\"> for T-bill 19 Sep 2023 (BS23118S) rebounded to 3.73%. Yay! This is a positive relief for investors as we have witnessed several consecutive auctions with decreasing yields. Let\u2019s dive deeper into the auction result.<\/span><\/p>\n\n<h2>Auction Summary<\/h2>\n<p><span style=\"font-weight: 400;\">Here is the summary of the auction:<\/span><\/p>\n<h3><span style=\"font-weight: 400;\">Allotment<\/span><\/h3>\n<table>\n<tbody>\n<tr>\n<td style=\"width: 50%;\"><span style=\"font-weight: 400;\">Total Amount Allotted<\/span><\/td>\n<td style=\"width: 50%;\"><span style=\"font-weight: 400;\">S$5.5 billion<\/span><\/td>\n<\/tr>\n<tr>\n<td><span style=\"font-weight: 400;\">Amount Allotted to Non-Competitive Applications<\/span><\/td>\n<td><span style=\"font-weight: 400;\">S$1.6 billion<\/span><\/td>\n<\/tr>\n<tr>\n<td><span style=\"font-weight: 400;\">Amount Allotted to MAS<\/span><\/td>\n<td><span style=\"font-weight: 400;\">S$0.0 million<\/span><\/td>\n<\/tr>\n<tr>\n<td><span style=\"font-weight: 400;\">Total Amount Applied<\/span><\/td>\n<td><span style=\"font-weight: 400;\">S$11.2 billion<\/span><\/td>\n<\/tr>\n<tr>\n<td><span style=\"font-weight: 400;\">% of Competitive Applications at Cut-off Allotted<\/span><\/td>\n<td><span style=\"font-weight: 400;\">Approximately 55%<\/span><\/td>\n<\/tr>\n<tr>\n<td><span style=\"font-weight: 400;\">% of Non-Competitive Applications Allotted<\/span><\/td>\n<td><span style=\"font-weight: 400;\">100%<\/span><\/td>\n<\/tr>\n<tr>\n<td><span style=\"font-weight: 400;\">Bid-to-Cover Ratio<\/span><\/td>\n<td><span style=\"font-weight: 400;\">2.03<\/span><\/td>\n<\/tr>\n<\/tbody>\n<\/table>\n<h3><span style=\"font-weight: 400;\">Yield and Price<\/span><\/h3>\n<table>\n<tbody>\n<tr>\n<td style=\"width: 50%;\"><span style=\"font-weight: 400;\">Cut-off Yield<\/span><\/td>\n<td style=\"width: 50%;\"><span style=\"font-weight: 400;\">3.73% p.a.<\/span><\/td>\n<\/tr>\n<tr>\n<td><span style=\"font-weight: 400;\">Cut-off Price<\/span><\/td>\n<td><span style=\"font-weight: 400;\">98.14<\/span><\/td>\n<\/tr>\n<tr>\n<td><span style=\"font-weight: 400;\">Median Yield<\/span><\/td>\n<td><span style=\"font-weight: 400;\">3.58% p.a.<\/span><\/td>\n<\/tr>\n<tr>\n<td><span style=\"font-weight: 400;\">Median Price<\/span><\/td>\n<td><span style=\"font-weight: 400;\">98.215<\/span><\/td>\n<\/tr>\n<tr>\n<td><span style=\"font-weight: 400;\">Average Yield<\/span><\/td>\n<td><span style=\"font-weight: 400;\">3.05% p.a.<\/span><\/td>\n<\/tr>\n<tr>\n<td><span style=\"font-weight: 400;\">Average Price<\/span><\/td>\n<td><span style=\"font-weight: 400;\">98.479<\/span><\/td>\n<\/tr>\n<\/tbody>\n<\/table>\n<p>&nbsp;<\/p>\n<h2>Yield Finally Rebounded<\/h2>\n<p><span style=\"font-weight: 400;\">After weeks of consecutive decline, we finally saw the rebound in the 6-month T-bill cut-off yield. After reaching its peak late last year, the yield continued to decline, reaching 3.70% in the previous auction. This T-bill 19 Sep 2023 (BS23118S) auction breathes a sigh of relief as the yield finally rebounded slightly to 3.73%.<\/span><\/p>\n<figure id=\"attachment_2189\" aria-describedby=\"caption-attachment-2189\" style=\"width: 629px\" class=\"wp-caption aligncenter\"><img loading=\"lazy\" decoding=\"async\" class=\"size-full wp-image-2189\" src=\"https:\/\/www.wealthfor.us\/article\/wp-content\/uploads\/2023\/09\/T-bill-6-month-interest-rates-history-until-19-Sep-2023.png\" alt=\"T-bill 6-month interest rates history until 19 Sep 2023\" width=\"629\" height=\"340\" srcset=\"https:\/\/cdn.wealthfor.us\/uploads\/2023\/09\/T-bill-6-month-interest-rates-history-until-19-Sep-2023.png 629w, https:\/\/cdn.wealthfor.us\/uploads\/2023\/09\/T-bill-6-month-interest-rates-history-until-19-Sep-2023-300x162.png 300w\" sizes=\"auto, (max-width: 629px) 100vw, 629px\" \/><figcaption id=\"caption-attachment-2189\" class=\"wp-caption-text\">Source: <a href=\"\/singapore-t-bill-interest-rate\/\">Singapore 6-month T-bill interest rates history<\/a><\/figcaption><\/figure>\n<p><span style=\"font-weight: 400;\">The chart shows that the yield has stabilized around this level since the second quarter of this year. Let\u2019s see if this level persists for the upcoming auctions. The good news is that the 3.73% yield is comfortably higher than the highest fixed deposit rates offered in Singapore.<\/span><\/p>\n<p>&nbsp;<\/p>\n<h2>Stable Demand<\/h2>\n<p><span style=\"font-weight: 400;\">The demand for the T-bill 19 Sep 2023 (BS23118S) was unchanged from the previous auction at $11.2 billion. This number is on the low side compared with the last several auctions. The total non-competitive bids also stayed the same at $1.6 billion.<\/span><\/p>\n<p><img loading=\"lazy\" decoding=\"async\" class=\"aligncenter size-full wp-image-2190\" src=\"https:\/\/www.wealthfor.us\/article\/wp-content\/uploads\/2023\/09\/T-Bill-19-Sep-2023-BS23118S-Demand-Chart.jpg\" alt=\"T-Bill 19 Sep 2023 (BS23118S) Demand Chart\" width=\"900\" height=\"560\" srcset=\"https:\/\/cdn.wealthfor.us\/uploads\/2023\/09\/T-Bill-19-Sep-2023-BS23118S-Demand-Chart.jpg 900w, https:\/\/cdn.wealthfor.us\/uploads\/2023\/09\/T-Bill-19-Sep-2023-BS23118S-Demand-Chart-300x187.jpg 300w, https:\/\/cdn.wealthfor.us\/uploads\/2023\/09\/T-Bill-19-Sep-2023-BS23118S-Demand-Chart-768x478.jpg 768w\" sizes=\"auto, (max-width: 900px) 100vw, 900px\" \/><\/p>\n<p><span style=\"font-weight: 400;\">With the total amount offered in this auction being on the lower side at $5.5 billion, it is a relief that the cut-off yield ended up slightly higher. Because almost everything is the same as in past auctions, the slightly higher yield may be attributed to marginally higher bids from market participants.<\/span><\/p>\n<h3><span style=\"font-weight: 400;\">Non-Competitive Bids Stayed Muted<\/span><\/h3>\n<p><span style=\"font-weight: 400;\">There is another positive takeaway from this auction. Total non-competitive bids were only $1.6 billion, well below the 40% threshold of $2.2 billion. As a result, all non-competitive bidders got their full allocation in this auction. Yay!<\/span><\/p>\n<p><span style=\"font-weight: 400;\">We have been monitoring the non-competitive vs. competitive bid amounts and noticed that, in the past several auctions, we no longer see the non-competitive bid threshold being hit. Going forward, we will keep monitoring this non-competitive bid amount to see whether this trend persists. After seeing that the limit was not met again in this auction, we are now more confident in submitting non-competitive bids in the upcoming auctions.<\/span><\/p>\n<p>&nbsp;<\/p>\n<h2>What Are T-Bill Alternatives?<\/h2>\n<p><span style=\"font-weight: 400;\">Investors investing in T-bills are probably drawn to them because of their almost risk-free profile and relatively competitive rates. The downside is that your capital is locked for 6 months, and there is no way to break it early without risking losing your money. Are there other alternatives to T-bills? <\/span><span style=\"font-weight: 400;\">Here are some options we use ourselves:<\/span><\/p>\n<h3><span style=\"font-weight: 400;\">Fixed Deposits<\/span><\/h3>\n<p><span style=\"font-weight: 400;\">This one is a no-brainer alternative. Fixed deposits have very similar characteristics to T-bills. Unfortunately, <span style=\"box-sizing: border-box; margin: 0px; padding: 0px;\"><a href=\"\/best-fixed-deposit-rates-singapore\/\" target=\"_blank\" rel=\"noopener\">fixed deposit rates in Singapore<\/a> have declined<\/span> for several months. Even the highest fixed deposit offering only offers up to 3.45%. Our local banks, OCBC and UOB, offer even lower rates of only 2.70%. Euwww\u2026 Against fixed deposits, T-bills are the clear winner here.<\/span><\/p>\n<h3><span style=\"font-weight: 400;\">High-Yield Savings Accounts<\/span><\/h3>\n<p><span style=\"font-weight: 400;\">High-yield savings accounts offer very competitive rates for those who meet the criteria. The requirements are tricky for most people, so the realistic interest rate is usually much lower. These high-yield savings accounts may be a good option if you can meet most of the requirements. One thing to note is that <strong>the interest rate is floating<\/strong>. If the benchmark interest rate begins to fall, the interest rate offered by high-yield savings accounts is also likely to drop immediately. This contrasts with T-bills, which lock in the interest rate until maturity.<\/span><\/p>\n<h3><span style=\"font-weight: 400;\">Cash Management Accounts<\/span><\/h3>\n<p><span style=\"font-weight: 400;\">C<a href=\"https:\/\/www.wealthfor.us\/article\/cash-management-accounts\/\" target=\"_blank\" rel=\"noopener\">ash management accounts<\/a> are rather tricky because they have a fundamentally different risk profile. You can earn more than\u00a0<span style=\"box-sizing: border-box; margin: 0px; padding: 0px;\">a T-bill, but the major downside is that\u00a0<strong>your principal isn&#8217;t<\/strong><\/span><strong>\u00a0guaranteed<\/strong>. Yes, you may lose money investing in those cash management accounts. Do your research on the underlying funds of those cash management accounts to ensure you understand where your money is going. Similarly,\u00a0<span style=\"box-sizing: border-box; margin: 0px; padding: 0px;\"><strong>interest rates are floating<\/strong>, and if the benchmark interest rate reverses, the rates these accounts offer <\/span>will likely drop as well.<\/span><\/p>\n<p>&nbsp;<\/p>\n<h2>What Would We Do?<\/h2>\n<p><span style=\"font-weight: 400;\">We like T-bills for our fixed-income portion. After comparing the alternatives, T-bills still seem like one of the better options for investors seeking fixed-income investments. We use a combination of T-bills, high-yield savings, and cash management accounts for parking our short-term cash.<\/span><\/p>\n<p>&nbsp;<\/p>\n<p><span style=\"font-weight: 400;\">What do you think? Are you interested in applying for the next T-bill? To get started, read our coverage on <\/span><a href=\"https:\/\/www.wealthfor.us\/article\/treasury-bills-t-bills-singapore-the-comprehensive-guide\/\"><span style=\"font-weight: 400;\">T-bills Singapore<\/span><\/a><span style=\"font-weight: 400;\"> and <\/span><a href=\"https:\/\/www.wealthfor.us\/article\/how-to-buy-t-bills-singapore\/\"><span style=\"font-weight: 400;\">how to buy T-bills<\/span><\/a><span style=\"font-weight: 400;\">.<\/span><\/p>\n<p><span style=\"font-weight: 400;\">If you plan to use CPF for the upcoming T-bill auction,\u00a0<\/span><span style=\"font-weight: 400;\"><span style=\"box-sizing: border-box; margin: 0px; padding: 0px;\">use our\u00a0<a target=\"_blank\" rel=\"noopener\">CPF T-bill calculator<\/a> to estimate how much more you can earn by investing your CPF-OA in T-bills<\/span>.<\/span><\/p>\n","protected":false},"excerpt":{"rendered":"<p>The cut-off yield for T-bill 19 Sep 2023 (BS23118S) rebounded to 3.73%. Yay! This is a positive relief for investors as we have witnessed several consecutive auctions with decreasing yields. Let\u2019s dive deeper into the auction result. Auction Summary Here is the summary of the auction: Allotment Total Amount Allotted S$5.5 billion Amount Allotted to&hellip; <a class=\"more-link\" href=\"https:\/\/www.wealthfor.us\/article\/t-bill-19-sep-2023-bs23118s-cut-off-yield-rebounded-to-3-73\/\">Continue reading <span class=\"screen-reader-text\">T-Bill 19 Sep 2023 (BS23118S) Cut-Off Yield Rebounded to 3.73%<\/span><\/a><\/p>\n","protected":false},"author":3,"featured_media":2191,"comment_status":"closed","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"footnotes":""},"categories":[101,102],"tags":[],"class_list":["post-2187","post","type-post","status-publish","format-standard","has-post-thumbnail","hentry","category-fixed-income","category-singapore","entry"],"yoast_head":"<!-- This site is optimized with the Yoast SEO plugin v28.8 - https:\/\/yoast.com\/product\/yoast-seo-wordpress\/ -->\n<title>T-Bill 19 Sep 2023 (BS23118S) Cut-Off Yield Rebounded to 3.73%<\/title>\n<meta name=\"description\" content=\"T-Bill 19 Sep 2023 (BS23118S) concluded with the cut-off yield rebounded to 3.73%. 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