In its latest auction calendar for Treasury bills (T-bills), the Ministry of Finance (MoF) has reported a demand for longer-term instruments that is more than double that of the previous quarter. The overall demand for T-bills in both past and upcoming auctions surpasses the projected budget deficit for the year.
The Ministry’s third-quarter T-bill calendar details plans to issue 288 billion birr worth of bills over the next three months through bi-weekly auctions.
For short-term maturities, the MoF aims to raise 22.8 billion birr from 28-day bills and 77.6 billion birr from 91-day bills, representing a decrease from the previous quarter’s targets of 24 billion and 85 billion birr, respectively.
Conversely, demand for longer-term maturities has surged. The calendar indicates an offering of 109 billion birr in six-month bills, an increase from 97 billion birr in the prior quarter.
For 364-day maturities, the MoF has proposed 78.5 billion birr to be sold over the next six bi-weekly auctions, reflecting a 115 percent increase from the 36 billion birr offered in the last quarter.
Financial experts suggest that this increasing preference for longer-term instruments should prompt the government to expand its issuance of six-month and one-year maturity bills.
This trend has been evident in recent weeks, with auctions drawing significant interest for both short and long-term bills.
CBE Capital, an investment bank, recently highlighted that the previous week’s bi-weekly T-bill auction confirmed trends observed throughout the last quarter of 2025.
In the first three quarters of the current budget year, the government plans to mobilize 531 billion birr through T-bill auctions.
For the 2025/26 budget year, the anticipated fiscal deficit is approximately 417 billion birr, which constitutes about 22% of the total 1.93 trillion birr budget.
This deficit is expected to be financed mainly through domestic borrowing—primarily T-bills—and support from development partners, marking a departure from previous reliance on monetary financing. This strategy is being pursued despite ambitious domestic revenue targets and significant debt-servicing costs.
