In its continued mitigation of the short-term liquidity and enhancing financial market stability, the Central Bank of Oman (CBO) has issued treasury bills worth OMR 89.85 million (equivalent to USD 233.3 million) this week. According to the report of the Oman News Agency (ONA), 91-day and 182-day bills in OMR 64.85 million and OMR 25 million were issued, respectively.
The 91-day treasury bills were issued at a mean price of OMR 98.98 to OMR 100, with the lowest price being accepted at OMR 98.97. The average discount rate on these securities was 4.07, and the average yield was 4.12 percent. The 182-day bills were sold at an average price of OMR 97.99, the same as the lowest price offered, and at a discount rate of 4.03 percent and an average yield of 4.11 percent.
The CBO kept these instruments at 5 percent in its repo rate, but kept the discount rate at 5.5 percent in the facilities of treasury bills. As defined by ONA, “Treasury bills are a short-term, guaranteed financial instrument issued by the Ministry of Finance to provide investment opportunities for licensed commercial banks. The Central Bank of Oman acts as the issuance manager for these bills”.
The issuance follows as Oman remains afloat amidst fiscal constraints, international interest rate volatility, and wider economic reforms in its diversification policy – Vision 2040. The treasury bills are readily convertible to cash via repurchase arrangements or the discounting method with the central bank due to their high liquidity. They are also used as a guideline to short-term interests within the domestic market and used by commercial banks in interbank repo deals.
This was developed in another direction, whereby the Oman public debt dropped by 2.08 percent annually to OMR 14.1 billion during the second quarter of 2025. The Ministry of Finance has been making settlements to the private sector totalling more than OMR 749 million during the period, and as a rule, within 5 working days. This has been a timely payment, which has contributed to increasing liquidity in the local markets.
The declining trend in the government debt supports the idea of the Sultanate being devoted to financial consolidation, and it is backed by the growth of non-oil income and stricter control of expenditures. The recent issue of treasury bills also indicates that the government is trying to augment the intensity and strength of the money market within the nation, and keeping short-term funding channels steady and sustainable.
