T-Bill Yields Decline as Ghana’s Government Records Oversubscription in Latest Auction

In a positive outcome for the government, the latest Treasury bill auction has surpassed expectations, with the government raising GHS 514 million more than the targeted GHS 8.26 billion. The auction, held by the Bank of Ghana, saw a total of GHS 8.77 billion in bids, reflecting an oversubscription of 6.22%. This indicates strong investor interest in Ghana’s short-term debt instruments.

The government accepted all GHS 6.2 billion tendered for the 91-day Treasury bill. Additionally, GHS 1.8 billion was accepted from the GHS 1.83 billion in bids for the 182-day bill, while GHS 746 million was accepted from the GHS 1.2 billion tendered for the 364-day bill. These results highlight an active and robust market for government securities.

Interest rates on Treasury bills have continued their downward trend. The 91-day bill saw a decline of 186 basis points to 15.88%, the 182-day bill fell by 204 basis points to 16.93%, and the 364-day bill dropped 101 basis points to 17.98%. This drop in rates suggests a gradual reduction in the cost of government borrowing, albeit at a slower pace.

Looking ahead, the Treasury plans to raise GHS 6.14 billion in the next auction. The continued decline in T-bill yields aligns with the government’s strategy to lower borrowing costs as it manages its fiscal responsibilities.

SOURCE: CITI NEWSROOM