The easing liquidity squeeze in the
market has seen short term government notes starting to pick up and
register more subscriptions compared to the previous period.
Poor performance of the short and long
term government securities since June this year has been attributed to
dry liquidity market that haunted most investors.
During this period, key investors on the
treasury bills and bonds were fulfilling tax obligations, thus reducing
the amount planned for investments.
Commercial banks are the leading
investors in the short- term government paper. Others are pension funds,
insurance firms and few microfinance institutions.
In the treasury bills auctioned by the
Bank of Tanzania (BoT) in Dar es Salaam yesterday received bids were
worth 165bn/- against 135bn/-.
It shows further improvements compared
to only 8.57bn/- fetched in the previous auction. The weighted average
yield to maturity across all tenures increased significantly compared to
the previous treasury bills auction conducted two weeks ago.
The BoT summary shows further that a
total of 80bn/- was sold in 364 days period, 622bn/- for 182 days,
18bn/- for 91 days tenure and 5bn/- for 35 days offer.
With the exception of 364-day bid that
registered oversubscription while the remaining offers were
undersubscribed, the weak performance was reported in the previous
session.
The 364 days attracted bids worth
88.22bn/- but at the end only 53.77bn/- emerged as successful amount;
for the 182-tenor, a total of 26.40bn/- was total amount tendered and
16.29bn/-was retained as successful bids.
For the 91-day attracted bids worth
10.93bn/- at the end only 930m/- emerged as successful amount while the
35 days offer attracted bids worth 1.5bn/- and was retained as
successful bids.
The weighted average interest rates on
the 364 days increased to 14.66 per cent compared to 13.61 per cent of
the preceding session.
On 182 days, interest rate rose to 13.85
per cent from 12.69 per cent while the 91 days offer, it changed
slightly to 8.19 per cent from 7.82 per cent.
Source: Daily News, reported from Dar es Salaam, Tanzania
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