Government securities primary auctions registered a mixed performance during the quarter ending June 2023, with investors’ preference leaning on the longer end of the yield curve.
According to the latest Quarterly Economic Bulletin released by the Bank of Tanzania (BoT), during the quarter under review, Treasury bills worth 709.2bn/- were auctioned to cater for government financing needs and liquidity management.
Total bids received amounted to 608.2bn/-, of which 544.3bn/- were successful.
“The weighted average yield increased to an average of 6.59 percent from 3.87 percent in the corresponding quarter in 2022,” the report says.
The Central Bank during the period under review also conducted Treasury bonds auctions for all maturities except the 7-year one to cater for government financing needs.
Treasury bonds worth 1.359.3trn/- were issued for auction during the quarter, which received bids amounting to 1.5trn/-
Out of the total bids, 1.29trn/- were successful. Yields to maturity rose across all tenures relative to the previous quarter, with exception of the 2-year bond.
Transactions valued at 7.57trn/- were traded in the interbank cash market (IBCM) during the quarter, higher than 7.33trn/- in the corresponding quarter in 2022.
“Transactions of 2 to 7-days remained dominant, accounting for 77 percent of the total market turnover,” the report says.
The overnight IBCM interest rate remained stable, though it increased to an average of 3.76 percent from 2.05 percent in the quarter ending June 2022.
Similarly, the overall 2 to 7-days IBCM interest rates rose to 5.06 percent and 5.09 percent, respectively.
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