Government short-term securities continued to enjoy strong investor appetite last week, allowing the Treasury to raise GH¢1.51 billion above its target at the latest Treasury bill auction.

Figures from the Bank of Ghana show that investors submitted total bids of GH¢9.10 billion across the 91-day, 182-day and 364-day Treasury bills, with GH¢9.08 billion accepted. The outcome translated into an excess demand of 29.41 per cent, marking the seventh consecutive auction in which investor demand surpassed the government’s target.

Market analysts attributed the sustained interest largely to improved liquidity conditions in the financial system, driven primarily by institutional investors.

The 91-day Treasury bill remained the most sought-after instrument, attracting GH¢6.54 billion in bids, almost all of which (GH¢6.53 billion) was taken up by the Treasury. The 182-day bill recorded bids of GH¢1.06 billion, with GH¢1.05 billion accepted, while the 364-day bill drew GH¢1.50 billion in bids, of which GH¢1.49 billion was accepted.

Yields edged up across most maturities, reflecting the strong demand environment. The 91-day bill rose by 6 basis points to 11.17 per cent, from 11.11 per cent, while the 182-day bill also increased by 6 basis points to 12.56 per cent.

In contrast, the 364-day bill recorded a marginal decline of 3 basis points, easing to 12.90 per cent from 12.93 per cent.

Analysts explained that the slight dip at the longer end reflects pricing dynamics between investors and the Treasury. While some investors submitted higher-yield bids in a bid to maximise returns, the Treasury appeared to reject those bids to contain borrowing costs, resulting in mild yield compression on the 364-day instrument.

Looking ahead, the Treasury is targeting GH¢7.14 billion at its next auction across the three short-term securities, as it continues to capitalise on favourable market conditions to meet its financing requirements.