Investor demand for Treasury bills in Ghana has rebounded strongly, with total bids of GH¢3.66 billion submitted across the 91-day, 182-day, and 364-day Treasury bills. This exceeded the government's target of GH¢2.75 billion, marking a 32.9% oversubscription. The strong demand is a reversal from the previous auction, which recorded an undersubscription of about 4%.
The government accepted GH¢2.90 billion of the bids submitted, representing about 79.3% of total investor demand. The 91-day bill accounted for the largest share, attracting GH¢2.08 billion in bids, of which GH¢1.88 billion was accepted. This indicates that investors remain interested in short-term government securities.
The 182-day instrument received GH¢702.95 million in bids, with GH¢520.57 million accepted, while the 364-day bill attracted GH¢876.72 million, of which GH¢497.74 million was taken up by the government. The varying acceptance rates across different maturities suggest that investors are making strategic decisions based on their investment goals.
The latest auction also showed continued declines in Treasury bill yields across all three maturities. The 91-day yield fell by two basis points to 4.67%, from 4.69% the previous week, while the 182-day yield dropped 11 basis points to 6.37% from 6.48%. This downward trend in yields may be attributed to the government's borrowing strategy and market dynamics.
The 364-day yield recorded the largest decline, falling 15 basis points to 9.83% from 9.98%. Analysts have attributed the stronger demand largely to the government's relatively softer borrowing target, against continued investor appetite for short-term government securities. This development may have implications for future auctions and the overall government borrowing strategy.
For the next auction, the government is targeting GH¢2.24 billion through the issuance of 91-day, 182-day, and 364-day Treasury bills. This lower target may be an effort to manage investor demand and borrowing costs. Investors will likely continue to assess the attractiveness of Treasury bills as a short-term investment option.
The rebound in Treasury bill demand is a positive development for the government, which relies on these securities to finance its operations. The strong investor appetite may also reflect confidence in Ghana's economy and the government's ability to manage its debt.
Key points
- Investor demand for Treasury bills exceeded the government's target by GH¢904.64 million.
- The government accepted GH¢2.90 billion of the bids submitted, representing about 79.3% of total investor demand.
- Treasury bill yields declined across all three maturities, with the 364-day yield recording the largest decline.
