The strong momentum in Ghana’s money market persists, with investors continuing to demonstrate heightened interest in Treasury bills (T-bill).
This follows the Government’s recent success in exceeding its T-bill target by GHS 1.9 billion and rejecting over GHS 10 billion in bids last week, indicating a strategy of yield control.
The latest auction results from the Bank of Ghana reveal that the government aimed to raise GHS 7.73 billion but received total bids of GHS 9.6 billion – surpassing the target by 165%.
For the 91-day and 182-day T-Bills, bids totaled GHS 7.38 billion and GHS 5 billion, respectively, with the Government accepting GHS 4.23 billion and GHS 1.43 billion. Bids for the 364-day bill reached GHS 8.11 billion, of which GHS 3.96 billion was accepted.
Despite this strong demand, interest rates on the short-term instruments declined. The 91-day and 182-day T-Bill rates fell to 24.47% and 25.38%, respectively, down from 26.85% and 27.80%. The 364-day bill also experienced a decrease in its interest rate to 27.29% from 29.07%.
Read Also: Appointment of MIIF CEO, Edward Koranteng Revoked
Recent Data From BoG On T-Bills (February 17):
Data from the Bank of Ghana (BoG) for the week of February 17 revealed that the Treasury rejected GHS 8.27 billion in bids at its latest auction – one of the largest rejections since March 2023.
Investors tendered GHS 17.70 billion against a target of GHS 8.07 billion, with GHS 9.43 billion accepted.
The 91-day bill saw bids of GHS 6.8 billion (GHS 5.2 billion accepted), the 182-day bill attracted GHS 4.5 billion (GHS 1.4 billion accepted), and the 364-day bill received GHS 6.2 billion in bids (GHS 2.7 billion accepted).
These rejections led to a sharp decline in yields, ranging between 26% and 27%, down from 28% to 30% the previous week. The 91-day and 182-day bills recorded a 1.3% and 1.07% decline in yields, ending the auction with interest rates of 26.85% and 27.80%, respectively. The 364-day bill ended with an interest rate of 29.07%.
Market analysts with Databank believe the rejections reflect the Treasury’s yield control strategy, designed to curb aggressive rate demands, ease borrowing costs, and guide the yield curve towards normalisation.
Despite the rejections, the government exceeded its target, indicating sustained strong investor interest in treasury bills as a safer alternative in the market.
Looking ahead, the Government aims to raise GHS 6.49 billion in debt on Friday, February 28, 2025. The Treasury also aims to raise GHS 7.7 billion in the next T-bill auction (date unspecified).
