SSB 10-year return at 2.56%. Better than T-bills and fixed deposits?

What happened?

Recently, the yield on the 6-month Singapore T-bill declined further to 2.20%. 

Meanwhile, the best 6-month fixed deposit rate dropped to 2.35% p.a.

Following this, there's been active discussions in Beansprout community about falling interest rates. 

When asked where is the best place to park my savings, the latest issuance of the SSB stood out with a 10-year average interest rate of 2.56%, above the T-bill yield and fixed deposit rate.

I’m often asked about the projected interest rate for the upcoming SSB. 

Knowing this can help us decide whether it’s better to apply for the current issuance or wait for the next one.

That’s why I decided to dive into the latest projections to estimate what the interest rate might look like for the next SSB.

What to expect for the latest Singapore Savings Bonds (SSBs)

#1 – Current SSB offers 10-year average interest rate of 2.56%

The latest SSB issuance offers a relatively attractive interest rate.

If you hold on to the SSB for 1 year, you will receive an average return of 2.20%.

If you hold on to the SSB for 10 years, you will receive an average return of 2.56% per year.

The 10-year average return of 2.56% p.a is below the rate of 2.69% p.a offered by the previous SSB. 

The 1-year rate of 2.20% is lower than the best 3-month and 6-month fixed deposit rate in Singapore.

#2 – SSB interest rate projected to fall to about 2.53%

For those new to the Singapore Savings Bond (SSB), it’s important to understand that SSB interest rates are closely tied to the yields of Singapore Government Securities (SGS). 

Similar to T-bills, SGS are bonds issued by the Singapore government. But, they have a longer maturity of 2 years to 30 years. 

The interest rates on each SSB issuance are linked to the daily average SGS yields as published by MAS in the previous month.

This means that the average annual return from the SSB over a given period (e.g., 10 years) would broadly reflect the yield of a comparable SGS (e.g., the 10-year SGS), but with about a one-month lag.

In other words, the 10-year average return of the upcoming SSB will largely mirror the yield of the 10-year Singapore government bond or SGS observed this month.

As shown in the chart below, the 10-year SGS yield has continued to trend downward through April and into May. 

This decline may be a sign of increased investor caution, with demand for safer assets like government bonds rising amid global uncertainties, such as concerns over Trump’s tariff policies.

As of 22 May 2025, the closing yield on the 10-year Singapore government bond was around 2.54%.

This is slightly below the 10-year average return offered by the current SSB. 

Based on the average yield observed in May, the 10-year average return for the next SSB is likely to be slightly lower than the current issuance.

As of 23 May 2025B, our SSB interest rate projection estimates that the next SSB may offer a 10-year average return of approximately 2.53%.

This estimate is based on the average closing yield of the 10-year Singapore Government Bond recorded so far in May, assuming the yield remains steady at 2.54% for the rest of the month.

#3 – Demand for SSB has fallen in the latest issuance

Despite offering relatively attractive interest rates compared to T-bills and fixed deposits, demand for the May issuance of the SSB declined notably.

Applications amounted to only S$432 million, a sharp drop from the S$678 million in the previous issuance that offered a 10-year average return of 2.85%—the highest application amount since September 2024.

With S$700 million of SSBs available in the current tranche, investors may receive full allocation if demand remains muted.

What would Beansprout do? 

The latest issuance of the SSB offers a 10-year average return of 2.56%. 

With the 10-year average return on the next SSB is projected to fall further to about 2.53%, it might be more worthwhile to apply for the current SSB rather than to wait for the next one. 

Apart from offering a higher 10-year average return compared to the 6-month Singapore T-bill yield and best 6-month fixed deposit rate, the latest SSB also allows us to lock-in a rate of 2.56% over 10 years, while having the flexibility to redeem prior to maturity. 

You can compare which are the best places to park your cash to earn the highest yield here.

To find out how much more interest you can potentially earn by swapping your previous bonds to the current, check out our SSB swap calculator.

If you are looking for the best place to park your savings, we compare SSBs to T-bills and fixed deposits to find out how to allow our spare cash to work harder. 

Applications for the latest SSB close at 9pm on 27 May (Tuesday). Redemptions of SSBs will also close at 9pm on 27 May (Tuesday).

You can sign up for a email reminder to be reminded of future SSB closing dates.

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Learn more about SSBs and how to apply for SSBs using our comprehensive SSB guide. 

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