Interest rates payable on government of Jamaica latest Treasury bills fell for the 28 and 91 days instruments but the rate for the 182 days that was below the 91 days instrument normalized by going above it this time compared to lower rates for the longer term instrument at the close of the February auction.
At the latest auction the 91 days T-bill ended up at 5.75 percent and was down by 25.4 basis point while the 28 days instrument fell by 15 basis points to 5.38 percent while the 182 days rose by 10 basis points to 5.83 percent, at the March 2015 auction this tenure of T-bill was at 7 percent and is down by 17 percent.
Falling Interest rates
March 22, 2016 by
Treasury bill rates fall
June 17, 2015 by
At the latest auction for the issue of Treasury bills held today, rates on the 28 days, the 91 days and 182 days bills declined from ay auction, continuing the decent starting March last year.
The latest rate on the 91 days instrument is now at 6.48 down from 6.57 percent at the May auction and the 182 days is now at 6.63 percent, a fall from 6.7 percent. The 28 days instrument ended with a rate of 6.23 percent down from 6.27 percent in May. The rates are far off from the BOJ CD rate of 5.25 percent.
A total of $1.2 billion was available for the public to bid on, split equally between the three issues. The 28 days offering attracted $475 million the 91 days attracted $602 million and the 182 days instrument attracted $828 million. With the interest rates on some of the Jamaican government’s bonds tied to Treasury bill rates, the latest development of lower rates will mean lower cost for the variable rate bonds.
With inflation looking as if it could end 2015 around 3.5 percent Bank of Jamaica may have to intervene by lowering the CD rate to speed up the fall in Treasury bill rates.