Govt raises sh4.429 trillion from sale of securities

KAMPALA - The Ugandan government raised sh4.429 trillion in May 2025 through the sale of its securities, according to the Ministry of Finance’s Performance of the Economy report for May 2025.

Of the total amount, sh755.5 billion was raised from treasury bills and sh3.6738 trillion from treasury bonds.

A total of sh2.4214 trillion was allocated to refinancing maturing securities, while sh2.008 trillion went towards financing other items in the national budget.

Yields (interest rates) on treasury bills increased for the 91-day and 364-day tenors, reaching 12.1% and 15.4% in May, up from 9.5% and 15.1% in April 2025, respectively.

However, the yield on the 182-day tenor bill continued its downward trend for the fourth consecutive month, falling to 12.7% in May from 12.8% in April.

All treasury bill auctions were oversubscribed, with an average bid-to-cover ratio of 1.5 recorded during the month.

According to the report, the government reopened 3-year, 10-year, and 20-year tenor bonds on the primary securities market.

Yields increased across all bonds compared to the previous auction of similar bonds, rising to 16.5%, 17.5%, and 17.9% for the 3-year, 10-year, and 20-year bonds, respectively, up from 16.2%, 17.1%, and 17.5%.

Likewise, yields on bonds sold via private placement also rose. Yields for 3-year, 5-year, 10-year, 15-year, and 20-year tenor bonds issued in the private placement were 16.5%, 16.7%, 17.5%, 17.7%, and 18.2%, respectively, compared to 16.2%, 16.5%, 17.1%, 17.0%, and 17.5% in the previous round.

The increase in yields on government securities was partly attributed to the government’s higher borrowing needs during the month.

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

The investment period for treasury bills ranges from three months to one year, while treasury bonds have tenors of two, three, five, 10, and 15 years.