MUSCAT: The Central Bank of Oman (CBO) has announced the successful allocation of government treasury bills worth a total of RO 20.3 million for the week.
In a statement, the CBO said RO 5 million was allocated to 28-day treasury bills. These were issued at an average accepted price of RO 99.700 per RO 100, translating to a discount rate of 3.91071% and a corresponding yield of 3.92248%.
Meanwhile, 91-day treasury bills accounted for RO 15.3 million of the total. These were allocated at an average accepted price of RO 98.936, with a minimum price of RO 98.930. The average discount rate for this tranche stood at 4.26790%, with an average yield of 4.31381%.
The repo rate for transactions involving these bills is currently 5%, while the discount rate under the Treasury Bills Facility with the CBO is set at 5.50%.
Treasury bills are short-term, government-backed instruments issued by the Ministry of Finance and managed by the Central Bank. They offer secure investment opportunities for licensed commercial banks and are a key tool in managing short-term liquidity in the local financial market.
These instruments are also tradable through repurchase agreements (repos) and can be easily liquidated by discounting with the CBO. Banks can additionally conduct interbank repo transactions, contributing to the creation of a benchmark for short-term interest rates.
Apart from supporting financial market stability, treasury bills provide the government with a flexible mechanism for financing expenditures without disrupting broader economic objectives. — ONA
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