New 6-Month Bill (est. 2.8%) and 5-Year Government Bond (est. 2.75%) Issue on 1st September 2022.

Currently, there are two Singapore Government Securities that are going to be auctioned soon that you might be interested in.

One is a six-month Government Treasury Bill, and another is a five-year Government bond.

These treasury bills and bonds issued by the Singapore government are relatively safe in the spectrum of financial securities. You might want to read my article on how to buy these government securities when they are first issued (such as this recent announcement) here.

BS22117S 6-Month T-Bill

The first issue is the fortnightly treasury bill issue. The auction’s end date is on the 1st of September. You have five more days to think about it.

The table above shows the price and the yield some of the bonds were trading in these few days. Currently, the market yield is about 2.88%, so it is will likely be the range you may get.

These treasury bills are pretty good for short-term liquidity. A good suggestion may be to form some sort of treasury bill ladder.

N522100N 5-Year Bond

The other issue is a longer tenor government bond issue. The issuer credit quality is excellent, but since the tenor is five years, you take on duration risk. Thus, you would have to consider your goal of investing in this intermediate duration bond carefully.

Here are more details about the bond.

The table above shows the average buying rates of 5-year bond yield by government securities dealers starting from August 2021 to July this year. What you will get would roughly depend on the prevailing yield 5-year government securities are trading at.

Per Investing.com, we can see the prevailing yield for different government bonds of various duration.

We are probably closer to 2.75% if the auction is done today.

A five-year government bond is suitable for some financial goal that is less inflationary, and you want to ensure you will have every single cent five years later and not a single cent less.

More details of both auctions can be found on MAS’s website here.

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