Ghana’s T-Bill Auction Oversubscribed by 42% as Investors Rush to Lock in Yields

Ghana’s latest Treasury bill (T-bill) auction has recorded a significant oversubscription, with investor demand surpassing the government’s target by 42.07%. According to data from the Bank of Ghana, the government initially aimed to raise GHS 3.86 billion but ended up accepting bids totaling GHS 5.48 billion. This trend signals strong investor interest in short-term government securities despite falling yields.

The breakdown of the accepted bids reveals strong performance across all maturities. The 91-day bill attracted the most attention, with GHS 4.32 billion accepted out of GHS 4.86 billion offered. For the 182-day bill, GHS 823 million was accepted from GHS 1.15 billion in bids. Meanwhile, the 364-day bill saw GHS 343 million accepted from GHS 774 million worth of offers.

Analysts say the surge in demand is primarily driven by institutional investors eager to lock in favorable yields amid expectations of further declines in interest and inflation rates. With monetary easing on the horizon, short-term securities are becoming increasingly attractive safe-haven instruments.

Despite the high demand, yields on all three T-bill tenors have continued their downward trend. The 91-day yield declined by 54 basis points to 10.29%, the 182-day dropped by 87 basis points to 12.35%, and the 364-day saw the steepest fall of 106 basis points to 13.24%. This indicates a shift in market sentiment toward anticipating lower rates in the near term.

Overall, the auction results reflect growing investor confidence in the government’s short-term debt instruments, especially as the economic outlook points toward declining inflation and a more accommodative monetary policy stance. The consistent oversubscription also suggests robust liquidity in the market and cautious optimism among institutional investors.

Source: Citi newsroom