According to the Bank of Zambia Q3 […]

According to the Bank of Zambia Q3 report, yield rates on both Treasury bills and Government bonds have maintained a downward trend since September 2024. The report seen by the Zambian Business Times (ZBT) shows that in June 2026, T-bill yields were at 11.5% and currently stand at 10.8%, and that GRZ bond yield rate fell to 16% in June this year and currently stands at 15.2%.

Further, the report attributes the downward trend mainly due to strong investor demand, particularly after raising non-resident participation in the primary market this year, and improved liquidity conditions.

Private Sector Development Association (PSDA) Chairperson Yusuf Dodia has attributed the continuous drop in yield rates due to oversubscription in government securities (T-bill & GRZ bonds).

 Speaking in an interview with Zambian Business Times (ZBT), Dodia, indicated that when government securities receive higher demand above the initial amount offered, yield rates tend to be reduced.

“Generally, the mechanism that tends to affect the yield rate in GRZ Bonds and Treasury Bills is when a specific tender records an oversubscription in the number of investors wanting to buy T-Bills and GRZ bonds, which leads to reduced rates in terms of returns”, said Dodia He added that lower interest from the government in sourcing funds to meet certain economic demand also affects the yield allocation in government securities.

 Dodia added that both factors are positive in the sense that if there is an oversubscription, it reflects that the T-Bills and GRZ are in demand.

“When government securities are oversubscribed, that signifies a positive development showing increased demand, and a similar government is no longer interested in money from the public it simply means that revenue is being collected through ZRA and other revenue sources for the government to meet the demand of the national budget”, said Dodia.

Article  by Justine Phiri