A ten-year Treasury bond was under
subscribed to cap weak performance of government securities in the
market for the month as investors are deterred by squeezing liquidity.
From the Bank of Tanzania (BoT) auction
summary, a total of 18.87bn/- was sold to the market out of 45bn/-, and
the government retained it as successful amount.
All the 20 bids that
were offered at the auction for application emerged successful.
The highest bid offered at the auction
was 77.61, the minimum bid/100 was 65.05 while the minimum successful
price/100 was 65.05. But the weighted average price for successful bids
was 73.63.
Also, the weighted average yield to
maturity was 17.01 per cent slightly higher than 16.69 per cent of the
previous sale of 10 years long term government note.
On the other hand, the weighted average
coupon yielded 15.53 per cent up from 15.27 per cent of the preceding
sale auctioned in April this year.
As prices fall, yield rates head north.
Funds raised from the sale of the government notes are targeted to
finance development projects like road and railway infrastructures that
are necessary cutting down cost of transport.
Financial analysts attribute weak
performance of almost all the government securities auctioned in June
this year to a tightening liquidity.
Some of the key investors in government
securities include pension funds, insurance firms, some microfinance
companies and few commercial banks.
Source: Daily News, reported from Dar es Salaam, Tanzania
0 comments :
Post a Comment