SSB January 2024 Result – Singapore Savings Bonds Undersubscribed 0.8x – Beragampengetahuan

In what could be the last issue (in a long time) that would be getting a yield of 3% or more, retail investors came for this SSB January 2024 issue which resulted in an under-subscription due to the lukewarm response from yield hunters.

$867.5 million (0.8x) worth of application was received out of the total $1.1 billion available

If you have noticed, the total amount offered for this issue of SSB was record-breaking at $1.1 billion ($100 million higher than the last two months), and it proved to be enough for the demand.

Historically, the SSB max. offered amount has always been $1 billion, and they were for the issues of December 2022 (3.47%), November 2023 (3.32%) and December 2023 (3.40%).

By offering an appealing yield of a little over 3% for ten years, Singapore Savings Bonds attracted tonnes of investors who managed to put more cash into this issue.

SSB Trend As Of January 2024

The Singapore Savings Bonds SSB historical interest rate has been really attractive for the past year.

• First-year interest: Lowest 2.76% vs. Highest 3.3%
• Average ten-year returns: Lowest 2.82% vs. Highest 3.47%

As of today, the yield for the next issue of SSB (February 2024) is expected to dip to around 2.8%.

For every issue of the Singapore Savings Bonds, the returns shall always be equal to the ten-year reference SGS yield if it is held to maturity.

There is no guesswork involved in how the SSB yield is determined, and there is official documentation detailing the calculations.

You can compare the charts (SSB avg. 10-year yield vs. 10-year reference yield) below and see how the general trends have mirrored each other.

The reason why SSB returns have inched upward is that the Fed has embarked on interest rate hikes in an attempt to combat inflation, with the past SSB interest rates climbing from the lows of January 2022 (1.78%) to the highs of December 2022 (3.47%) and December 2023 (3.40%)

Allotment Result For SSB January 2024 (SBJAN24 GX24010F)

This January 2024 SSB issue was undersubscribed.

• Total offered = $1.1 billion
• Total applied = $867.5 million
• Total allotted = $853.0 million
• Quantity ceiling = $200,000

The maximum amount of Savings Bonds that each investor may hold at any one time is $200,000.

Market Expects Rates To Hold Steady For Now

At the moment, interest rates are expected to maintain at current levels through 2023 until the second quarter of 2024.

If you are an investor of REITs like me (personally, I use Syfe REIT+), the pain will continue to reflect in the prices in the short term, and many REITs will continue to announce distributions that are under pressure from heightened borrowing costs.

Businesses will continue to be hurt by higher costs of funds, whereas home-buyers will have to grapple with higher home loan rates.

Based on market news we have seen over the past three weeks, the signs are getting clearer that the Fed is done with rate hikes.

This could mean that the long-awaited pivot is indeed here, and the market thinks another rate hike will not happen, at least until the next FOMC meeting.

You can compare the two screenshots of the CME FedWatch Tool that I have taken below.

Based on the CME FedWatch Tool, the market is currently expecting interest rates to remain at around 5.25% to 5.50% range until March 2024, and the decline in interest rates is expected to be faster than originally expected after the recent dovish stance by the Federal Reserve.

You probably have your own thoughts as to whether you’re going to be keeping funds on the sidelines for now or to keep dollar cost averaging into the market.

If rates somehow defy all expectations and continue to go up, we can always redeem our older Singapore Savings Bonds and buy newer ones, as I mentioned in the tweet below.

How To Check The Historical SSB Allotment Results

To get an overview of the allotment results for past issues of the Singapore Savings Bonds, click here.

You may also log in to the MAS Singapore Savings Bonds portal to check your existing SSBs investment and results.

FAQ #1 – When will the monthly SSB results be announced?

MAS will always announce the overall application results on the third last business day of the month.

FAQ #2 – When will unsuccessful applications be refunded?

Money will be refunded by the second last business day of the month.

FAQ #3 – When are the interest payment dates?

The interest payment months for Singapore Savings Bonds is every subsequent six months after the issue date.

For the latest January 2024 Singapore Savings Bonds, the interest payment months will look like the following.

If you need the official Monetary Authority of Singapore’s SSB calculator, head over to the Singapore Savings Bonds portal by MAS.

Currently, alternative short-term instruments offer stiff competition with high yields (4%), whereas risk appetite has seemingly returned for some investors.

Fun fact → In total, about 120,000 individuals held more than $5.7 billion worth of SSB at the start of 2022.

Learn more → Read These 37 Things to become an expert on Singapore Savings Bonds

Well Positioned With SSBs Or Seek Better Yield?

As always, I am constantly on the lookout for what future SSB issues will bring, despite the fact that I am already well-positioned with my emergency funds earning a guaranteed, risk-free rate of more than 3% with Singapore Savings Bonds for the next ten years.

While the importance of the 10-year duration cannot be overstated, I understand the burning desire for higher yields for our dry powder.

If need be, I can redeem the issues of SSBs that I hold – but that is very unlikely to happen.

Data illustrates very clearly that SSBs yielding more than 3% have seen very little redemptions.

Meanwhile, if you are still standing on the sidelines with idle cash getting next to 0% interest, it would be a waste not to deploy them in low or no-risk options for attractive returns while waiting.

Where I Am Getting Good Yield For Idle Funds Now?

In addition to Singapore Savings Bonds, I have idle funds parked in the Fullerton SGD Cash Fund and Mari Invest.

Effortless 3.5% to 4% yield is extremely attractive and a reality that we wake up to every day, at least for now.

They trump digital bank options such as GXS Bank (2.68%), Trust Bank (1.5% to 2.5%), and MariBank (2.88%) in terms of returns and offer equivalent or close to instant liquidity.

Digital advisors such as Endowus ($20 off fees) and low-cost brokerages (e.g. Webull and Tiger Brokers etc) offer access to the Fullerton SGD Cash Fund with the exact same low fees as MoneyOwl, which has winded down its investment business.

Looking at market expectations, I think it is fair to say that there is a very good chance that rates are going to pivot very soon.

Kevin started beragampengetahuan when his net worth languished at negative $25,755. His desire to turn things around led him to build passive income from investments and side hustles that pay for his daily expenses and vacations. You can learn more about Kevin here.