MAS has just released the latest SSB May 2025 (SBMAY25 GX25050T): 2.49% for the first year and 2.69% for the 10-year average. Unfortunately, these rates are much lower than last month’s offering. We expected these lower rates because global rates have declined recently, fueled by recession fears due to the US tariff policy.
SSB May 2025 Details
This month’s SSB follows the trend of decline rates we have seen in the past several months. The first-year rate is 2.49%, while the 10-year average is 2.69%. Many investors will likely be disappointed with these rates as they have been used to the higher rates in past years.
If you are interested in the SSB May 2025, you may follow the following application timeline:
Competitiveness
With the interest rates offered at one of the lowest in recent years, we can say that this month’s SSB is not that competitive. Here are the historical SSB rates over the past years:
The chart shows that the latest rates from SSB May 2025 are among the lowest in the past few years. However, the current rates are still much higher than those observed in mid-2022 or earlier.
How about future rates? Let’s dive deeper.
Future Rates Projections
If you have been following us, you should know that we are in the middle of a rate-cut cycle. The rate cuts have been slower than anticipated due to sticky inflation and unexpected tariff policy from the current US administration. However, despite that, from its latest FOMC meeting, the Fed still expects two rate cuts in 2025.
The market also expects lower rates in 2025:
The table shows that the market expects up to three rate cuts in the second half of this year, which is aligned with the Fed’s expectation.
Given that SSB rates typically follow the 10-year government bond yield, we anticipate that SSB rates will continue declining in the long term, mirroring these rate cuts.
How about next month? We can try to estimate by looking at the current 10-year Singapore government bond yield movement:
The chart shows that the Singapore 10-year bond yield has gradually declined recently. If this trend continues, we may anticipate slightly lower rates in next month’s SSB offering. However, it may be harder to estimate for now because it is still early in the month.
What Do We Do?
We use SSB to park our short—and medium-term cash positions because it allows us to redeem monthly without penalty while still partially accruing interest.
Because we anticipated that interest rates would decline, we migrated all of our T-bill allocation into SSB last year. This move will lock in these higher rates for up to ten years.
We have optimized our SSB allocation over the past two years. Since this May 2025 SSB offering has lower rates than our current ones, we will likely not participate this month.
Will you be applying for this month’s SSB? If so, you may follow our step-by-step guide on how to buy SSB.
