In the recent auction conducted by the Bank of Ghana (BoG) on behalf of the government, investor appetite for short-term treasury bills surpassed expectations, resulting in an oversubscription of GHS 205 million.
The successful mobilization of GHS 4,124 million against a programmed target of GHS 3,919 million underscores growing confidence in the government’s fiscal management.
Investors demonstrated robust interest across the board, tendering GHS 2,533 million and GHS 1,110 million for the 91-day and 182-day bills, respectively. Additionally, the 364-day bill attracted GHS 481 million in bids. Notably, the government accepted all tenders, reflecting a strong demand for short-term debt securities.
Despite the oversubscription, yields on the 91, 182, and 364-day Treasury Bills largely exhibited stability, recording no changes from the previous week with the exception of the 182-day bill which inched upwards marginally by 0.2%. This resilience suggests that investors, while eager to participate, were willing to accept existing rates, possibly driven by confidence in the reliability of the short-term instruments.
As of the latest auction, interest rates stood at 29.5%, 31.9%, and 33.4% for the 91, 182, and 364-day T-Bills from the previous week’s interest rates of 29.5%, 31.7%, and 33.4% respectively. The week-on-week constancy in rates indicates a market environment where investors are content with the prevailing terms.
Looking ahead, the government aims to secure GHS 3,984 million in fresh funding through the issuance of 91-day, 182-day, and 364-day treasury bills scheduled for December 15, 2023. This forward-looking approach underscores the government’s commitment to addressing short-term financing needs proactively.
The oversubscription of the recent treasury bills, coupled with unchanged interest rates, paints a positive picture of investor confidence in the government’s financial management. The stability in yields indicates a balanced market, with investors demonstrating a continued appetite for short-term government debt instruments. As the government seeks fresh funding, market participants will closely watch for any shifts in investor sentiment and evolving market dynamics.
