Zambia’s first treasury bill auction for 2023 opened to bids that were 6.38 percent lower than the 2022 opening year’s bids resulting in yield rates reducing for the 3-, 9- and 12-month’s paper.
According to results published on the Bank of Zambia website, the T-bill auction held on Thursday, January 12, 2023 had total bids received amounting to K3,258.34 million (face value) for an allocation of K2,000.00 million (at cost). In comparison, the open year total bids received amounted to K3,476.78 million (face value) for the same allocation.
The reduction in yields for the three T-bills was 25, 50 and 1 basis points for the 3-, 9- and 12-month’s paper.
Despite the reduction in yields, investors were keener on longer term paper in 2023 compared to the previous year. Interest in the 1-year T-bill was 15% higher at K 2.3 billion compared to K2.0 billion in the previous year for the same K1 billion amount offered.
Interest in longer term paper for extant investors is a signal of confident on Zambia’s macro-economic standing. However, reducing yield rates will also have investors seeking out other instruments over the near-term.
The next opportunity for investors to show their face will be the Bond auction that is scheduled for Thursday, January 19, 2023.