Namibia is offering better interest rates than South Africa when selling treasury bills.
Treasury bills are short-term loans to the government that are paid back in three, six, nine, or 12 months.
A report by Simonis Storm shows that a three-month Namibian bill pays significantly more than a South African one.
This makes Namibia a more attractive place for investors to park their money right now.
Last week the Bank of Namibia borrowed N$1.51 billion through treasury bills. This was secured domestically.
The central bank received N$2.7 billion in total bids for the N$1.51 billion on offer, with an average bid-to-offer ratio of 1.70x.
“The liquidity environment is improving, and oversubscription at auction continues to be at good levels,” says Simonis Storm.
Namibian bills offer a premium over South African benchmarks, with the three-month yield differential standing at -60 basis points (bps).
Meanwhile, the six-month yield had -47bps, nine-month had -45 bps and 12-month had -42bps.
