Govt raises sh1.8 trillion from selling securities

KAMPALA - The Ugandan government raised shillings 1.861 trillion from three auctions of its securities on the domestic market in June 2025.

Of this, shillings 393.09 billion was used for refinancing of maturing securities, while shillings 1,468.11 billion (shillings 1.468 trillion) was used to finance other items in the budget.

Government securities are debt instruments/products, which they sell to finance day-to-day governmental operations.

This is according to the finance ministry performance of the economy report for June 2025.

The report also indicates that yields (interest rates) on treasury bills for the 364-day and 182-day tenors edged upwards to 15.6% and 12.8% in June 2025 from 15.4% and 12.7% a month earlier, respectively.

However, the 91-day tenor bill slightly edged downwards to 12.0% in June 2025 from 12.1% in the previous month.

All auctions for treasury bills remained oversubscribed, ending the fiscal year with an average bid-to-cover ratio of 1.55 in June 2025.

Yields for the bonds mostly edged upwards in comparison to the rates registered in previous auctions of similar securities. Yields for the 5-year and 15-year tenor bonds increased to 16.8% and 17.8% in June 2025 from 16.7% and 17.7% recorded in the previous auctions, respectively.

The annualised yield for the 2-Year tenor bond remained unchanged at 15.75% in June 2025 for the third time running.

Treasury bills are risk-free short-term financial instruments for investment regularly issued to the public by the Government through the Bank of Uganda (BOU), while treasury bonds are long-term financial instruments also issued by the Government through BOU to the investing public.

The investment period for treasury bills is short-term tenors of three months, six months and one year, while that of treasury bonds is long-term tenors of two years, three years, five years, 10 years and 15 years.