The Bank of Uganda (BoU) will raise Shs355 billion in its upcoming Treasury Bills auction scheduled for 24 September 2025.
The sale includes Shs25 billion in 91-day bills, Shs75 billion in 182-day bills, and Shillings 255 billion in 364-day paper.
This comes as yields on government securities trend upward due to tight liquidity in the banking sector and persistent inflation.
At the previous auction, cut-off yields for the 364-day bills exceeded 14 percent, with shorter-term instruments also seeing increases from August levels.
Analysts attribute this to the central bank’s cautious monetary stance, noting that inflation, while moderating, remains above the medium-term target of 5 percent.
Participation is open to Primary Dealer banks, including Stanbic Bank, Standard Chartered, Absa, Equity, Centenary, Citibank, Dfcu, and Housing Finance Bank, who will submit competitive bids on behalf of clients.
Non-competitive bids, accessible to the general public, are capped at Shillings 200 million per maturity.
Treasury Bills serve a dual purpose for the government: mobilizing funds to finance the national budget and managing liquidity in the financial system.
For investors, T-bills provide risk-free returns backed by the sovereign and a hedge against market volatility.
With subdued equity market performance, fixed-income securities remain an attractive option for portfolio diversification.
Market analysts expect strong demand for the auction, noting that recent issues have been oversubscribed as local banks and offshore investors seek safety in Uganda’s stable debt instruments.
The upcoming auction will settle on 25 September 2025, with maturities in December 2025, March 2026, and September 2026.
BoU has also highlighted that the amounts on offer are subject to adjustment depending on market conditions, allowing the central bank to respond dynamically to shifts in liquidity, inflation, and fiscal financing needs.
The Treasury Bills auction underscores Uganda’s continued reliance on domestic capital markets for financing and provides investors another opportunity to earn attractive, sovereign-backed yields.