The government borrowed ¢8.25 billion on the treasury market in the month of April 2023, 18.20% above its gross target.

The funds were used to refinance maturities worth ¢6.3 billion.

The 91-day and 182-day yields ticked higher at 19.95% (+56 basis points month-on-month) and 22.71% (+85 basis points month-on-month) respectively.

The 364-day settled at 27.26% (+160 basis points month-on-month).

Analysts perceive yields might settle lower at the end of May 2023 due to the improving economic outlook though there is scope for a further rise this week.

“Yields will resume the downturn in late 2023 with the IMF programme as a catalyst” investment firm, IC Securities stated.

After plummeting from a peak of 35.0% to between 18.5% and 26.8% by mid-March 2023, yields on T-bills have found renewed upward drive from the unexpected 150 basis points hike in the policy rate.

In the near-term, the Treasury’s continued dependence on the money market, without an active primary bond market, will hold yields elevated around current levels of between 19.0% – 27.0%.

Analysts expect trading in T-bills will continue dominating the secondary fixed-income market in 2023 amidst the lack of price action on the bond market.

This is expected to drive down trading yields with a spillover to the primary market for T-bills, supporting the downside view on yields by full year 2023.