Foreign Exchange Rates

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Wednesday 12 October 2016

DEMAND FOR TREASURY BILLS IMPRESSIVE


The quest to raise 139.5bn/- through treasury bills auction was met after attracting total bids worth 148.78bn/-, which is over and above the targets. Investors' appetite for treasury bills has started to pick up after weeks of poor performance largely due to easing liquidity squeeze in the circulation.

In the short term government paper auctioned by the Bank of Tanzania (BoT) on Wednesday the two tenures 364 and 182 days contributed about 99 per cent of the total bids while 91 and 35 shared less than one per cent.

The 364 and 182 days offer attracted bids worth 74.25bn/- and 74.47/-respectively against 75.5bn/-and 59bn/- offered to the market for bidding while the 91 days and 35 days offer attracted 8m/- and 50m/-.

Yield rates for the 364 and 182 days offer were 15.97 per cent and 15.56 per cent compared to 15.86 per cent and 15.68 per cent respectively of the previous session held two weeks ago.

For the 91 days tenure interest rate was 7.52 per cent while 35 days was 7.32 per cent respectively compared to 7.46 per cent compared to 7.54 per cent of the preceding session.

The highest and lowest bid/100 for the 364 and 182 days offers were 86.84/ 84.00 and 93.01/ 92.21 respectively while for the 91 and 35 days tenor had 98.16/ 98.16 and 99.30/ 99.30. The minimum successful price/100 for the 364, 182 and 91 days offer were 85.14, 92.74, 98.16 and 99.30 respectively.

The weighed average price for successful bid for the 364 tenure was 86.26, the 182 days offer was 92.80, 91 days offer was 98.16 and 99.30.

Major investors in the one year treasury bills are commercial banks, pension funds, insurance companies and some microfinance institutions.

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