Credit Kekeli K. Blamey
The government has fallen short of its treasury auction target by GHS 1.59 billion, according to the latest data published by the Bank of Ghana.
The government aimed to raise GHS 6.43 billion through the auction of treasury bills but received total bids amounting to GHS 4.73 billion.
This shortfall highlights growing caution among investors and shifting dynamics in the local debt market.
All bids submitted for the 91-day treasury bill were accepted, amounting to GHS 2.98 billion. However, acceptance was more selective for longer-term bills. Of the GHS 869 million offered for the 182-day bill, only GHS 668 million was accepted.
For the 364-day bill, GHS 1.43 billion in bids were received, but only GHS 1.07 billion was accepted—mainly through non-competitive bids, where investors do not specify interest rates.
This strategy by the Treasury to selectively accept bids led to a drop in interest rates across all maturities:
The 91-day bill yield dropped from 15.32% to 15.23%.
The 182-day bill fell from 16.02% to 15.77%.
The 364-day bill saw the sharpest decline, falling from 18.37% to 16.95%.
Market analysts believe the government is deliberately lowering its borrowing costs in response to reduced investor demand and the need for more affordable debt financing.
“The decline in yields suggests that the government is prioritizing cheaper borrowing, even if it means raising less money than planned,” said one analyst familiar with the market trends.
In the upcoming auction, the government is targeting GHS 6.69 billion. How investors respond will provide further insights into confidence levels in the country’s short-term debt instruments.
