Ghana government beats Treasury bill target by 73% as one-year yield nears 13%

The government of Ghana raised GH¢9.4 billion through its latest Treasury bill auction, exceeding its target by 73%, while the yield on the one-year bill climbed to 12.98%.

Auction results published by the Bank of Ghana showed that investors continued to favour the 364-day bill, which offered the highest interest rate among the securities on offer.

The government received bids worth GH¢10.7 billion and accepted GH¢9.4 billion. The results indicate strong demand for short-term government debt, although the level of interest varied across the different maturities.

The 364-day Treasury bill attracted the largest share of investor interest. Slightly more than GH¢6.0 billion was tendered for the bill, accounting for 55.8% of total bids, while GH¢5.8 billion was ultimately accepted.

The 182-day bill received bids totalling GH¢1.9 billion. Of that amount, a little more than GH¢1.1 billion was accepted.

Meanwhile, investors tendered GH¢6.0 billion for the 91-day bill, with slightly more than GH¢5.8 billion accepted.

The latest auction also produced mixed movements across the yield curve, with shorter-term rates falling while the return on the longest-dated bill increased.

The yield on the 91-day bill declined by 14 basis points to 5.62%. The rate on the 182-day bill also fell, dropping to 7.52% from 7.64% at the previous week’s auction.

By contrast, the yield on the 364-day bill rose by 2.0 basis points to 12.98%, bringing the rate close to 13.0%.

The continued preference for the one-year bill reflects its comparatively higher return, according to the auction data. With most investors again directing more funds towards the 364-day instrument, it remained the most subscribed bill in the latest sale.

Despite the increase in the one-year yield, overall demand allowed the government to secure more funding than its target. The accepted bids included subscriptions across all three maturities, with the 91-day and 364-day bills accounting for the largest amounts taken up in the auction.

The results underline the differing investor response to Ghana’s Treasury bills, as demand remained substantial for both the shortest and longest maturities, while the 182-day bill attracted a smaller volume of accepted bids.