T-bill yield dips to 1.37%. What's driving the decline?

What happened?

The Singapore T-bill yield has fallen once again. 

In the auction on 6 November, the cut off yield for the 6-month Singapore T-bill (BS25122A) declined to 1.37% from 1.41% n the previous auction. This follows the interest rate cut by the US Federal Reserve last week.

With the recent decline in interest rates on savings accounts and fixed deposits, I have seen more discussion in the Beansprout community about the Singapore T-bill.

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

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

#1 - Demand for the Singapore T-bill soared

Total applications for the 6-month Singapore T-bill rose sharply to S$18.6 billion in the latest auction on 6 November from S$15.9 billion on 23 October. 

This represents the highest amount of T-bill applications in the past six months, exceeding the recent high of S$18.4 billion in the auction on 28 August 2025.

The amount of competitive bids increased to S$17.3 billion. 

If you placed a competitive bid below 1.37%, you would receive 100% of your requested T-bill allocation.

If you bid at exactly 1.37%, the allocation would be around 14%.  

The amount of non-competitive bids increased to S$1.3 billion on 6 November from S$1.1 billion on 23 October.

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 increased slightly

The amount of T-bills issued was at $8.0 billion, which was slightly higher than the previous auction on 23 October at $7.9 billion. 

With the higher amount of T-bill applications, the ratio of applications to T-bills issued (bid-to-cover ratio) increased to 2.33x. 

#3 - Median and average yield of bids submitted fell

The median yield of bids submitted fell slightly to 1.30% from 1.35% in the previous auction. 

The average yield of bids submitted dropped to 1.14% from 1.29% in the previous auction. 

The sharp decline in the average yield of bids submitted suggests that there were significant bids that were placed at below 1.14%.

What would Beansprout do?  

The lower T-bill yield likely reflects the sharp increase in demand for the Singapore T-bill.

This may be because the T-bill appears relatively more attractive with the stabilisation of yields in recent auctions, as well as continued demand for safe haven assets.

The latest cut-off yield for the Singapore T-bill is now slightly below the best 6-month fixed deposit rate in Singapore of 1.40% p.a. 

It would also be quite close to the 1-year return of 1.35% on the latest Singapore Savings Bonds (SSBs).

However, we were still able to find savings accounts in Singapore that offer an interest rate of above 1.37% p.a. 

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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