Will the T-bill yield rebound in the auction on 13 March?

What happened?

The next 6-month Singapore T-bill auction (BS25105T) will be coming up on 13 March 2025.

Despite the sharp fall in T-bill yields recently, it still seems like many investors are interested in the T-bills.

In the past auction, demand for the 6-month Singapore T-bill remained close to a record high despite a fall in the cut-off yield to 2.75%.

Likewise, I still see many questions in the Beansprout community on the T-bill

In this post, I will be looking at the latest indicators to find out if it might still be worthwhile applying for the upcoming T-bill auction.

6 Month T-Bill Auction Details 7 Mar 2025 — Source: MAS

Here's what to expect for the Singapore T-bill auction on 13 March

#1 – US bond yields have declined

The 10-year US government bond yield stood at 4.2% on 7 March, declining from 4.4% from two weeks ago.

This is due to growing concerns about a sharp economic slowdown in the US, after the latest economic data point to a decline in consumer confidence with the tariff uncertainty.

US 10 YR Govt Bond Yield Closing 7 Mar 2025 — Source: Tradingview

Likewise, the yields on US government bonds with shorter maturities have declined too.

The 1-year US government bond yield has fallen to 4% from 4.1% two weeks ago.

US 1 YR Govt Bond Yield Closing 7 Mar 2025 — Source: Tradingview

#2 – Closing yield on 6-month Singapore T-bill has also declined

We have seen a similar decline in Singapore government bond yields with the fall in US government bond yields.

The Singapore 10-year government bond yield has dropped to 2.7% on 7 March from 2.8% two weeks ago.

SG 10 YR Govt Bond Yield Closing 7 Mar 2025 — Source: Tradingview

Likewise, the closing yield on the 6-month T-bill was 2.73% on 6 March , slightly below the cut-off yield of 2.75% in the previous T-bill auction on 27 February.

SG 6 Month T-Bill Closing Yield 7 Mar 2025 — Source: MAS

The yield on the 3-month MAS bill can also give an indication of the yields for shorter-maturity Singapore government bonds.

The cut-off yield was at 2.78% in the auction on 4 March, falling further from 2.85% in the auction on 25 February.

SG 3 Month T-Bill Closing Yield 7 Mar 2025 — Source: MAS

#3 – Same issuance size compared to the previous auction

The issuance size of the upcoming 6-month Singapore T-bill is $7.5 billion, the same as the amount offered in the previous auction.

We saw a slight decline in the amount of T-bill applications to S$20.1 billion in the auction on 27 February from S$23.3 billion in the auction on 13 February. Despite this moderation, demand still remains strong, as that represented the second-highest amount of applications in history.

If demand for the T-bill were to remain strong, we might see further pressure in the cut-off yield for the T-bill.

What would Beansprout do?

The closing yield on the 6-month Singapore T-bill was at 2.73% on 6 March , slightly lower than the cut-off yield in the previous auction.

This is because we have seen a fall in Singapore government bond yields with the decline in US bond yields.

With the fall in the T-bill yield, I would be looking for alternative places to park my cash.

If I have S$50,000 of cash, I would put my money into fixed deposits, as the best 6-month fixed deposit rate of 2.85% would be above the T-bill cut-off yield of 2.75% in the previous auction.

If I have S$100,000 of cash, I would put my money into the UOB Stash account, which allows me to earn an effective interest rate of 3.0% without having to jump through hoops. In addition, I can earn a guaranteed cash of S$388 with the S$100,000 of fresh funds deposited with the UOB Pot of Gold promotion.

To park a smaller amount of savings, the best savings account in Singapore offers an interest rate of 2.88% p.a.

For CPF investors, the closing yield is also below the breakeven cut-off yield for CPF-OA funds.

You can find out what is the breakeven yield on the Singapore T-bill for CPF applications using our CPF-T-bill calculator.

The 6-month Singapore auction will be held on 13 March (Thursday). We would need to put in our cash applications for the T-bills by 9 pm on 12 March (Wednesday).

Applications for the T-bills using CPF-OA will close 1-2 business days before the auction date, and the dates differ across the three local banks.

Applications for T-bills online using CPF OA via DBS close at 9pm on 12 Mar (Wed). Read our step-by-step guide to applying via DBS.
Application for T-bills online using CPF OA via OCBC close at 9pm on 12 Mar (Wed). Read our step-by-step guide to applying via OCBC
Applications for T-bills online using CPF OA via UOB close at 9pm on 11 Mar (Tue). Read our step-by-step guide to applying via UOB.

If you are new to investing in the T-bill, check out our comprehensive guide to Singapore T-bills to learn more.

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