6-month T-Bills Auction on 8 Nov – Interest rates to break 4.0% again? Singapore Savings Bonds a better buy?



So… the next T-Bills auction is on 8 November (Wednesday).

You may recall that T-Bills yields went as high as 4.07% 3 auctions ago.

Then demand for T-Bills soared, and yields dropped to 3.87%.

Then demand fell back down, and yields crept up to 3.95%.

What will happen the next auction?

Will we see interest rates cross 4.0% again?

Are T-Bills still worth buying given how attractive Singapore Savings Bonds are this month?

Let’s dive in.


Next T-Bills auction is on 8 Nov (Wed) – (BS23122F 6-Month T-bill)

First off – next 6 months T-Bills auction is on 8 November 2023 (Wed).

Do note that unlike most other T-Bills auctions (which fall on Thursday) – this T-Bills auction is on Wednesday.

This means that:

  • If you’re applying in cash do apply by 9pm on 7 Nov 2023 (Tues)
  • If you’re applying using CPF-OA do apply by 6 Nov 2023 (Mon).

What is the estimated yield on the next 6-month T-Bills auction? (BS23122F 6-Month T-bill)

T-Bills trade at 3.90% on the open market

6-month T-Bills are trading at 3.90% on the open market.

But… T-Bill trading liquidity is incredibly thin

But we’ve seen the past few auctions that trading liquidity on the T-Bills is so thin – that actually the market pricing is not really all that indicative.

You’ll find that the market pricing actually takes its cue from the latest T-Bills auction.

The past few auctions where the T-Bills auction yield diverged materially from market price.

It was actually market price that adjusted to the latest T-Bills auction yield, rather than the other way around.

So I would caution against placing too much reliance on market pricing on T-Bills – there just isn’t sufficient trading liquidity for true price discovery.

12-week MAS Bills flat at 4.06%

The institutional only 12-week MAS Bills have been flat the past month or two – at 4.06%.

Sharp moves in MAS Bills are a good indicator of the trend for T-Bills.

So as of now, MAS Bills are not showing any big changes in yields either way.

If you are submitting a competitive bid I do suggest taking a quick look at the latest MAS Bills pricing before you apply.

If there is a sharp move up or down – that could suggest a similar trend for T-Bills (can access it here).

Demand for T-Bills plunged the previous auction

Demand for T-Bills fell quite a lot in the previous auction.

From $14.7 billion the previous auction, to only $11.5 billion.

That’s a whopping 21.7% drop in T-Bills demand.

This caused T-Bills yields to rebound to 3.95%

This caused a T-Bills yields to rebound.

From 3.87% to 3.95%:

Median Yield – Average Yield spread is very tight – very few “lowballers”?

To illustrate what this is:

Imagine you have 100 bids.

The median yield, is if you arrange all the bids from small to high, and take the yield of the 50th bid.

While average yield, is adding up the yields of all 100 bids and dividing by 100.

So average yields are skewed by lowball bids, while median yields are not.

To put it simply – the bigger the spread between the median yield and average yield, the more “low-ballers”.

You can see how the spreads between median and average yield are very tight the past 3 auctions – the tightest it has been in 2023.

And with the most recent T-Bills auction, spreads actually tightened even further with the drop in demand.

This is quite a bullish sign, and if this keeps up it indicates yields may stay high.

Will demand for T-Bills drop further, or go up?

Ultimately, the big wildcard is the demand for T-Bills the next auction.

Given the rebound in T-Bills yields.

Will we see more demand for T-Bills, or lower demand?

Really your guess is as good as mine here.

Estimated yield of 3.85% – 4.00% on the 6-month T-Bills auction? (BS23122F 6-Month T-bill)

Let’s put it all together.

Market interest rates still remain high.

No material change in short term interest rate outlook (long term is a different story after the Treasury announcement this week).

Demand for T-Bills has come down meaningfully the last auction, and spreads are very tight – but there is uncertainty over the next auction.

Given all the above.

I would probably go with an estimated yield of 3.85% – 4.00% on the next T-Bills auction.

A big wildcard is the Israeli-Hamas conflict.

If there is a significant escalation in the conflict, then all bets are off (as you may see a risk-off).

Should you submit a competitive or non-competitive bid?

I usually encourage investors to submit a competitive bid (just in case there is a freak result and yields drop a lot).

And submit as close to the deadline as you can, so you can take a look at where market pricing is at that time before deciding on your bid.

But I know some investors really don’t like competitive bidding.

In which case non-competitive bidding is probably fine as well (saw full allotment the previous auction).

Are T-Bills still worth buying vs Singapore Savings Bonds or Fixed Deposit or Savings Accounts?

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Singapore Savings Bonds are pretty attractive buy

Now this month’s Singapore Savings Bonds are actually really attractive – the most attractive it’s been all year.

You’re locking in 3.30% yield for the next 6 years, stepping up to 3.40% over 10 years.

That’s risk free yield locked in for 10 years, and you can get the money back anytime with no capital loss.

Considering CPF-OA pays 2.5%, and most people’s mortgages are below 3.40%, to be able to lock in 3.40% for 10 years is very attractive.

Will next month’s SSBs have even higher yields?

Singapore Savings Bonds yields track the average yield 10 year Singapore government security for the previous month.

Given that it’s only the start of the month, it’s hard to say how the 10 year SGS yields will play out this month.

Because of that I’ll do an updated post to share my views on SSBs (and whether to buy this or wait) later this month.

So… Buy Singapore Savings Bonds or T-Bills?

But gun to my head today – I don’t think you’ll see 10 year yields go up materially this month (because of US moves, where the Treasury has reduced the amount of long term debt they are issuing, which should provide a reprieve for long term yields).

Because of that I think this month’s SSBs are a pretty good buy and worth subscribing for.

So if your funds are limited, you may want to think about whether to buy T-Bills or save the cash for Singapore Savings Bonds.

Best Fixed Deposit option? RHB Bank at 3.68%

The best Fixed Deposit option I could find today is RHB at 3.60% for 6 months.

Minimum of $20,000, that steps up to 3.68% if you are premier banking.

So if you don’t want to buy T-Bills, this is probably the next best thing.


Picking between T-Bills vs Singapore Savings Bonds vs Fixed Deposit vs Savings Accounts?

I would say if you want the highest short term yield, T-Bills are probably your best bet.

The drawback with T-Bills is the (1) lack of liquidity, and (2) short duration of 6 months.

So you can’t put all your money in T-Bills too.

Singapore Savings Bonds (SSBs) are great to address the duration point, locking in 3.40% for 10 years.

This month’s Singapore Savings Bonds are the best in all of 2023, and I myself would be applying for some.

Where am I parking my cash for liquidity?

To address the liquidity point I’ve been doing a mix of the below:


Approx Yield





Singapore Savings Bonds



MariBank Account

2.88% – 3.5%



In the past I also tried GXS (2.68%) and Chocolate Finance (4.5%).

But MariBank by Shopee has higher yields (2.88%) than GXS while being SDIC insured so it’s a no brainer.

While Chocolate Finance is technically not risk free (4.5% on $20,000), so I hesitate on putting too much in as well.

Am I applying for T-Bills?

This month’s Singapore Savings Bonds are very attractive, and I want to apply for a meaningful chunk.

REITs prices are also very attractive after the sell-off, so I may add to REITs positions too.

Would I still apply for more T-Bills?

Haven’t decided frankly.

I’ll probably put in a competitive bid with some spare funds (I redeemed a tranche of older SSBs), just in case yields are particularly juicy.

Let’s see.


This article was written on 3 Nov 2023 and will not be updated going forward.

For my latest up to date views on markets, my personal REIT and Stock Watchlist, and my personal portfolio positioning, do sign up as a Patreon.


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