The Treasury bills auction results have gone against debt analysts prediction as yields went north instead of south.
The analysts had it that the bill yields and subscription level will go down because debt investors lose appetite, after the yields dropped below the inflation rate level thus losing the real value of their investment.
Zan Securities Chief Executive Officer Mr Raphael Masumbuko said the auction took a different direction as the 364 day bill yield rose for the first time in 10 auctions, the 35 day bill was subscribed for the first time since mid-April and the 91 day bill was subscribed for the first time since August.
"This auction results could mean a change in direction of the central bank’s monetary policy implementation," Mr Masumbuko said in the firm's Weekly Market Wrap-ups report yesterday.
In the mid-last week auction, the weighted average yield increased slightly for the 364-day bill by 30 basis points to 3.92, the 182-day lost 1 basis point to 3.04per cent, the 91-day bill gained 64 basis points to 2.66per cent, and the 35-day bill lost 50 basis points to 2.43per cent.
The inflation for September, according to the National Bureau of Statistics (NBS), jumped slightly up to 4.0 per cent from 3.8per cent.
Vertex International Securities said in its Weekly Market report that the Treasury bills went against their predictions.
"Auction results for Treasury bills went against our forecast as yields increased," Vertex said.
The 364 days tenor was undersubscribed by 57per cent while the 182 days tenor was oversubscribed by 50per cent. The 35 days and 91 days tenors were fully subscribed different from most recent Treasury bills auctions.
The public offered less than the amount the central bank sought to raise for 364-day bills of 72.92bn/- and at the end of the auction took 12.27bn/-.
The 182-day was oversubscribed as BoT wanted to raise 3.0bn/- got 4.5bn/-. At the end of the day, the central bank took 3,0bn/- as yields lost 1basis points to 3.04per cent.
BoT also took out the amount tenders which marched with that offered of 1.1bn/- for the 35-day bill while1.8bn/- was offered for the 91-day bill.