After the auction, supply outstanding for June 2025 will increase to $11.7 billion making it the most liquid issue on the SGS curve, notes Yong and the team.
UOB’s global economics and market research team as well as interest rates strategist Victor Yong is “less enthusiastic” on the outperformance of the upcoming two-year Singapore Government Securities (SGS) compared to the US Treasuries (UST) or the Singapore overnight rate average (Sora) overnight index swaps (OIS).
The two-year SGS, which matures on June 1, 2025, will be reopened on Feb 24 to the tune of $3.2 billion, making this the largest size for the two-year tenor bonds. The sum is also $0.6 billion higher than the last two-year auction in June 2022. This will be the fourth re-tap for the issue since it was first introduced as a 10-year bond in 2015.
