Will I still buy T-Bills at 3.73% yield? For Cash and CPF-OA Buyers? Compared vs Fixed Deposit, Singapore Savings Bonds, Syfe Cash+ Guaranteed (Next Auction on 31 Aug)



So the next T-Bills auction is on 31 August (Thursday).

And I know that T-Bills yields have been very disappointing of late – closing at 3.73% the last auction.

Based on latest market pricing it doesn’t look like this will change materially for the current auction (barring any big change).

So 3 questions I wanted to discuss:

  1. What is the estimated yield on the next 6-month T-Bills auction (BS23117Z 6-Month T-bill)
  2. How does T-Bills compare against other alternatives – for both cash and CPF-OA buyers?
  3. Will I still buy T-Bills?


Next T-Bills auction is on 31 August (Thursday) – BS23117Z 6-Month T-bill

First off – next 6 months T-Bills auction is on 31 August 2023 (Thursday).

If you’re applying in cash do apply by 9pm on 30 August 2023 (Wed)

For CPF you’ll want to get it done by 29 August.

What is the estimated yield on the next 6-month T-Bills auction (BS23117Z 6-Month T-bill)

T-Bills trade at 3.73% on the open market

Latest 6 months T-Bills trade at 3.73% on the open market – exactly in line with the last T-Bills auction cut-off yield.

12-week MAS Bills up slightly to 4.00%

The institutional only 12-week MAS Bills have ticked up slightly to 4.00%.

But this is a very slight increase only.

The past few auctions the MAS Bills have proven to be a very good indicator of the trend for T-Bills, so if you plan to apply for this auction I do suggest taking a quick look at the latest MAS Bills pricing before you apply – just in case there are any big changes (can access it here).

T-Bills downtrend due to China risk-off?

As you can see, T-Bills yields have been on a downtrend the past few auctions.

This is despite the fact that T-Bills application amounts have actually been going down, instead of up.

It gets even more interesting when you look at US short term yields – where both the 1 and 2 year  Treasury have been flat for the past 2 months.

My theory is that the drop in T-Bills yields is due to an influx of liquidity into SGD due to the China risk-off move.

Which would explain the drop in yields despite flat US yields, and declining T-Bills demand.

But frankly this is just an educated guess – and if anyone has better explanations I am keen to hear them.

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Estimated yield of 3.65% – 3.80% on the T-Bills auction?

Based on the above.

I don’t think we will see a big move in T-Bills yields from the previous auction.

Estimated yield of 3.65% – 3.80% on the next T-Bills auction would be my base case.

As always, I encourage investors to submit a competitive bid.

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

How does T-Bills compare against other alternatives – for both cash and CPF-OA buyers?

Are T-Bills still attractive vs other alternatives?

Let’s start with looking at options for cash.

Fixed Deposits at 3.55% yield for 9 months ($10,000 minimum)

The best fixed deposit in the market today is 3.55% with CIMB Bank.

Do note that this is for a 9 months lock-in, and a minimum amount of $10,000.

If you want 6 months the rate drops to 3.35%.

So frankly not all that attractive vs T-Bills.

Syfe Cash+ Guaranteed – 3.70% yield for 3 months (no minimum)

Syfe just launched a new cash management option last week.

I have an in depth review on Syfe Cash+ Guaranteed here.

The long and short is that:

  • 3.70% yield
  • 3 month lock up period
  • Funds are deposited with institutional class fixed deposits

3.70% for 3 months is competitive vs T-Bills.

However the Syfe Cash+ Guaranteed is technically not risk free, in that it is not SDIC insured or backed by the Singapore government.

The cash is placed in fixed deposits with banks, so if the bank goes under then it’s only covered up to the SDIC limits (which is guaranteed to cross given the sums in play).

Granted, the risk is miniscule, but still an important point to note with Syfe Cash+ Guaranteed.

It’s the same logic with money market funds, where yields are competitive with T-Bills and you get T+1 liquidity, but technically not risk free.

Singapore Savings Bonds at 3.01% yield

Alternatively you can go with Singapore Savings Bonds.

Yields up to 7 years are 3.01%.

Not all that exciting, but the huge benefit is you lock in the rates up to 10 years.

You can get the money back any time with accrued interest and no capital losses (at the start of the next month).

And actually with the sharp rise in the 10 year SGS yield – you’re going to see Singapore Savings Bonds look even more attractive next month.

I myself am applying for Singapore Savings Bonds this month, and I will likely do so next month as well.

T-Bills still a great buy for CPF-OA buyers?

If you’re a CPF-OA buyer though, there’s frankly no other real option for you.

There used to be fixed deposit CPF-OA options, but those have been mostly taken off the market for now.

I’ve run the numbers below – you can see that even at 3.73% it is still comfortably above CPF-OA’s 2.5%.

It’s a 27% increase in interest earned vs CPF-OA (assuming no changes in CPF-OA rates).

Will I still buy T-Bills?

With CPF-OA, it’s still a no brainer to buy T-Bills.

Cash though, gets a bit more tricky.

For the first time this cycle – I am starting to get concerned about interest rate cuts in the next 6 – 12 months.

Coupled with the sharp rise in long term yields, Singapore Savings Bonds are going to get more attractive the next month or two, and I do see myself putting some money there.

I still have $75,000 held with GXS bank after moving the funds over for the 3.5% interest (that was brutally slashed to 2.68% barely a week later).

2.68% is not bad for spare cash considering the instant liquidity, but I probably don’t want to leave $75,000 there at 2.68%.

Fixed deposit at 3.55% frankly isn’t all that attractive, considering I need to open a FD account with CIMB.

Syfe Cash+ and money market funds are worth considering, too, but do note that they are technically not risk free.

All things considered, I’ll probably still be applying for the T-Bills auction, but it won’t be a big chunk of cash.

Probably just a portion of my cash to earn the higher ~3.7% yields, while the rest goes into a mix of other options.

Would love to hear what you are doing though – are you still buying T-Bills at 3.73%?


This article was written on 25 August 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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  1. So technically we’re still experiencing a classic yield inversion, where short-term yields are higher than long-term yields. Singapore T-bills and Singapore savings bonds are the best a risk-free investments for Singaporeans and PRs. Some people are starting to say the interest cycle has peaked and that with US consumer liquidity becoming exhausted a proper recession is coming. On top of that China is still in trouble, and that is going to affect everybody. A simple strategy would be to take advantage of this to build a bond ladder with T-bills (6 and 12 month) and (if do don’t already have one) to set up a safety fund with Singapore savings bonds (SSBs). SSBs are great becaise you can effectively roll them over into higher-rates and only forfeit one month’s interest, when and if significantly higher rates come along. My thinking is that once a solid fixed interest portfolio is in place with risk-free rates similar to equity returns (as they are right now) we can switch back to dollar cost averaging into index funds, better quality REITs and bank shares.


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