BS25105T 6-Month T-Bill Yield Projection

This Opinion post first appeared in my blog here: https://pwlcm.wordpress.com/2025/03/11/bs25105t-6-month-t-bill-yield-projection/

Disclaimer: This post is just for educational sharing purposes. Please do your own due diligence on any products mentioned in this post.

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Yield Premium Projection

The updated 6-Month T-Bill vs 12-Week MAS Bill Yield chart and the T-Bill Yield Premium Statistics table are shown below:

The cut-off yield of ML25110S is 2.62%. This time I turn to consider the 2025 statistics with average yield premium of -0.12% and standard deviation of 0.07%. With that, the projected cut-off-yield for BS25105T would be:

Projected Cut-Off Yield = 2.62% – 0.12% = 2.50%
Projected Lower Yield = 2.50% – 0.07% = 2.43%
Projected Higher Yield = 2.50% + 0.07% = 2.57%

Polynomial Trendline Projection

Based on 3rd Order Polynomial Trendline Projection:

From the trendline projection chart, the projected yield is approximately at 3.02%. With standard deviation of T-bill cut-off yield at 0.12% as seen in the T-Bill Yield Premium Statistics table in 2025, the projected cut-off-yield for BS25105T would be:

Projected Cut-Off Yield = 3.02%
Projected Lower Yield = 3.02% – 0.12% = 2.90%
Projected Higher Yield = 3.02% + 0.12% = 3.24%

Summary

Yield Premium Projection:
Projected Cut-Off Yield = 2.50%, ranging from 2.43% to 2.57%

Polynomial Trendline Projection:
Projected Cut-Off Yield = 3.02%, ranging from 2.90% to 3.24%

This round the projected yield from the Yield Premium method and Polynomial Trendline method suffered a drop of 13 and 5 basis points respectively.

With the supply of the coming T-bill BS25105T remained at $7.5 billions and institution sentiment dropping 13 basis points, I’m going to project that the cut-off yield will follow the institution drop of 13 basis points, i.e. from 2.75% for BS25104H to 2.62%.