How to read Ethiopian Treasury bill auction results

First identify the auction and maturity

An auction number and date identify the event. The maturity columns then separate 28-, 91-, 182- and 364-day bills. Choose one column before reading down the rows, so that an amount for a short bill is not accidentally paired with a yield for a longer one.

A tender notice describes a planned auction. A result describes the outcome after bids have been considered. Keeping them separate prevents an announced offer from being mistaken for completed issuance.

Read the unit labels at the same time. NBE results express amounts in ETB millions, prices per ETB 100 and yields as annual percentages. A printed amount of 250 in an ETB-million row therefore represents ETB 250 million.

Follow the offer, bids and accepted amount

The amount offered is what was put on offer. Bids received measure the submitted demand. The accepted amount records the amount accepted from that demand. These figures answer different questions and need not be equal.

In a fictional maturity column, suppose the offer is ETB 100 million, bids are ETB 150 million and the accepted amount is ETB 80 million. Demand was 1.5 times the offer, but the recorded accepted amount was ETB 80 million. Calling the full ETB 150 million issued would confuse demand with acceptance.

Dividing bids by the offer can describe auction demand. It does not give an individual bidder's chance of receiving an allocation. The auction's pricing and acceptance process, bid categories and a particular instruction still matter.

Read a price quotation as a purchase amount

A price per ETB 100 scales the purchase price to a common face amount. A quotation of 97.50 means ETB 97.50 for each ETB 100 of face value. For a fictional ETB 10,000 face amount at that price, the purchase cost is ETB 9,750 before charges.

If that bill is held to maturity and repays ETB 10,000, the cash difference is ETB 250 before costs. Its holding-period return on the ETB 9,750 purchase cost is about 2.56%. The annual yield shown in a result is a different, annualized measure.

Read a price and yield alongside the same maturity. For the same repayment amount and date, a lower purchase price produces a higher return. That relationship helps interpret the table without assuming that a published annual rate is the cash percentage earned over every shorter term.

What cutoff and weighted-average rows tell you

A cutoff identifies the boundary of accepted bids. In a price-based illustration, accepting bids down through a price of 98 would make 98 the cutoff price in that illustration. It describes how far acceptance extended into the bids, rather than the average price of the accepted amounts.

A weighted average gives larger accepted quantities more influence than smaller ones. Suppose a fictional amount-weighted calculation includes ETB 1 million of face value at a price of 98 and ETB 3 million at 99. The weighted price is 98.75, because three quarters of the amount is at 99. Simply averaging the two prices would give 98.50 and would ignore those different quantities.

That example explains weighting; use the published basis and included bid categories for an actual result. An auction's total yield should not be reconstructed by taking the simple arithmetic average of its four maturity yields.

The average is useful for describing an auction. It does not establish the price paid by every investor, and it is not automatically a quote available for a new purchase. Result notes can also distinguish competitive and non-competitive categories. Read the published basis when comparing averages across tables.

Turn a result into a meaningful comparison

For a trend, follow the same maturity and yield measure over successive auction dates. For the term structure at one auction, compare the four maturity columns from that same event. Keeping the comparison consistent prevents a switch in maturity from appearing to be a change in the market over time.

Look at accepted amounts as well as yields when describing activity. A yield observation and the amount accepted provide different pieces of information. A blank or dash is also different from a reported zero: an unavailable observation cannot support the same calculation.

The current data block below provides the latest saved auction used on Aksion. Open the full history to inspect earlier results and the date behind each observation.

• Explore the auction history
• Understand the data fields and missing values