T-bill yield rises to 1.39%. What's driving the bounce?

What happened?

The results of the latest Singapore T-bill auction are out.

In the auction on 20 November, the cut off yield for the 6-month Singapore T-bill (BS25123E) increased to 1.39% from 1.37% in the previous T-bill auction. 

With the decline in T-bill yield we have seen in recent auctions, the latest result may be a surprise to some investors.

In this article, I'll look at what is driving the increase in T-bill yield, as well as  how it compares to the best fixed deposit rates as a place to park your cash to earn a higher yield. 

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What we learnt from the latest 6-month Singapore T-bill auction

#1 - Demand for the Singapore T-bill declined

Total applications for the 6-month Singapore T-bill fell to S$16.9 billion in the latest auction on 20 November from S$18.6 billion on 6 November. 

The amount of competitive bids decreased to S$15.8 billion. 

If you placed a competitive bid below 1.39%, you would receive 100% of your requested T-bill allocation.

If you bid at exactly 1.39%, the allocation would be around 21%.  

The amount of non-competitive bids fell to S$1.1 billion on 20 November from S$1.3 billion on 6 November.

Since the amount of non-competitive bids was within the allocation limit, all eligible non-competitive bids received full allocation for the T-bill. 

#2 - T-bills issued remain constant

The amount of T-bills issued was same as the previous auction on 6 November at $8.0 billion.

With the lower amount of T-bill applications, the ratio of applications to T-bills issued (bid-to-cover ratio) decreased to 2.11x. 

#3 - Median and average yield of bids submitted rose

The median yield of bids submitted rose slightly to 1.34% from 1.30% in the previous auction. 

The average yield of bids submitted bounced to 1.22% from 1.14% in the previous auction. 

This may reflect the bounce in US government bond yields, as comments from Fed officials suggest that rate cuts in December are far from certain.

Given the median yield and the cut-off yield, this suggests that a substantial number of bids were placed in the 1.34% to 1.39% range, on par with the best 6-month fixed deposit rate in Singapore. 

What would Beansprout do?  

The higher T-bill yield is likely driven by the decrease in demand for the Singapore T-bill.

At the same time, we have seen a bounce in the average and median yields of bids submitted, reflecting the increase in US government bond yields in the past week.

Despite the bounce, we would continue to start to look for other ways to earn a higher yield on our cash.

For example, the best 6-month fixed deposit rate in Singapore of 1.40% p.a..is above the cut-off yield of the latest T-bill.

One other option to consider the Singapore Savings Bonds (SSB), which offers a 1-year return of 1.35% and average annual return of 1.85% over 10 years, while having the flexibility to redeem prior to maturity. 

We were also able to find savings accounts in Singapore that offer an interest rate of above 1.39% p.a. 

To compare between fixed deposits, T-bills, savings account and SSBs, check out our guide to the best places to park your cash in October 2025.

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To find out other ways to make your savings work hard, check out our guide to best ways to earn a passive income in Singapore.

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