Investor demand weakens as T-bill auction records 10.4% shortfall

Investor appetite for Government of Ghana short-term securities remained subdued in the final Treasury bill auction for April, as total bids fell below the government’s target by 10.4 percent.

According to auction results, a total of GH¢4.49 billion was tendered across the 91-day, 182-day, and 364-day Treasury bills, while GH¢4.44 billion was accepted by the Bank of Ghana.

This was against an issuance target of GH¢5.01 billion, leaving a shortfall of GH¢571.21 million and reflecting weaker-than-expected participation in the primary market.

At the short end of the yield curve, the 91-day Treasury bill attracted GH¢1.89 billion in bids, all of which was accepted, indicating continued strong investor preference for short-term instruments. The 182-day bill also recorded full subscription, with GH¢764.25 million in bids fully taken up.

However, demand weakened slightly at the long end. The 364-day bill saw GH¢1.83 billion in bids, but only GH¢1.78 billion was accepted, suggesting some level of bid rejection and caution among investors toward longer maturities.

Yields recorded marginal increases across all tenors. The 91-day bill remained unchanged at 4.92 percent, while the 182-day bill edged up by 1 basis point to 6.96 percent. The 364-day bill rose by 7 basis points to 10.19 percent from 10.12 percent previously.

The outcome points to ongoing liquidity pressures in the market, coupled with investor preference for shorter-term securities and a more cautious outlook on longer-dated government instruments.

Meanwhile, the government is expected to reduce its borrowing target to GH¢4.34 billion in the next auction as it adjusts its financing strategy.

Prince Antwi

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