BS25125Z 6-Month T-Bill Yield Projection

This Opinion post first appeared in my blog here: https://pwlcm.wordpress.com/2025/12/16/bs25125z-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 ML25150N is 1.44%. Considering the 2025 statistics with average yield premium of -0.07% and standard deviation of 0.07%. With that, the projected cut-off-yield for BS25125Z would be:

Projected Cut-Off Yield = 1.44% – 0.07% = 1.37% Projected Lower Yield = 1.37% – 0.07% = 1.30% Projected Higher Yield = 1.37% + 0.07% = 1.44%

Polynomial Trendline Projection

Based on 3rd Order Polynomial Trendline Projection:

From the trendline projection chart, the projected yield is approximately at 1.35%. With standard deviation of T-bill cut-off yield at 0.61% as seen in the T-Bill Yield Premium Statistics table in 2025, the projected cut-off-yield for BS25125Z would be:

Projected Cut-Off Yield = 1.35% Projected Lower Yield = 1.35% – 0.61% = 0.74% Projected Higher Yield = 1.35% + 0.61% = 1.96%

Summary

Yield Premium Projection: Projected Cut-Off Yield = 1.37%, ranging from 1.30% to 1.44%

Polynomial Trendline Projection: Projected Cut-Off Yield = 1.35%, ranging from 0.74% to 1.96%

This round MAS Bill ML25150N cut-off yield raised 4 basis points to 1.44% from ML25148F 1.40%, and the supply of the coming T-Bill BS25125Z reduced slightly to $7.9 billion dollars. Both factors assert positive pressure to the coming T-bill cut-off yield.

With the MAS Bill ML25150N raising 4 basis points, I’m going to project that the cut-off yield for BS25125Z would also raise by 4 basis points from the last T-Bill BS25124F cut-off yield at 1.41%. Therefore my projected yield for BS25125Z would be 1.45%.