24 March 2014

Tanzania: Two-Year Govt Bonds Hook Investors

DESPITE slashing yields on the two-year treasury bonds auctioned on Wednesday, the government note remained attractive and greeted by investors' deep appetite leading to oversubscription.

The auction results by the Bank of Tanzania (BoT) show that the weighted average yield to maturity sliding to 14.4 per cent compared to 15.07 per cent of the previous session conducted early January, this year.

The outstanding performance of the short and long term government notes is a sign of high liquidity level in the circulation chasing for few investment opportunities.

Analysts say the local money market is highly liquid, the situation that made the 2-year treasury bond to be oversubscribed by 85.6bn/- with weighted average yield going down to 14.4 per cent from 15.07 per cent seen previously.

The market was offered with 30.9bn/- but high investors appetite pushed the figure to 116.5bn/- and the government taking 75bn/- as successful amount.

A total of 97 bids were received but only 57 emerged successful, indicating that some bidders' price was below the market price.

Copyright © 2014 Tanzania Daily News. All rights reserved. Distributed by AllAfrica Global Media (allAfrica.com). To contact the copyright holder directly for corrections — or for permission to republish or make other authorized use of this material, click here.

AllAfrica publishes around 2,000 reports a day from more than 130 news organizations and over 200 other institutions and individuals, representing a diversity of positions on every topic. We publish news and views ranging from vigorous opponents of governments to government publications and spokespersons. Publishers named above each report are responsible for their own content, which AllAfrica does not have the legal right to edit or correct.

Articles and commentaries that identify allAfrica.com as the publisher are produced or commissioned by AllAfrica. To address comments or complaints, please Contact us.