Investors have continued to show strong appetite for Ghana’s short-term government securities, with demand for Treasury bills nearly doubling the amount the government targeted at the latest primary market auction.
Data from the Bank of Ghana showed that investors submitted bids totalling GH¢11.28 billion for the 91-day, 182-day and 364-day Treasury bills, compared with the government’s target of GH¢5.99 billion.
The auction was therefore oversubscribed by 88.2 per cent, with investor bids exceeding the government’s target by approximately GH¢5.29 billion.
However, despite the strong demand, the government accepted only GH¢4.88 billion of the bids, signalling a cautious approach to domestic borrowing.
The 91-day Treasury bill attracted the highest level of investor interest, with bids amounting to GH¢5.07 billion. The government accepted GH¢4.07 billion, representing about 80 per cent of the bids received for the instrument.
For the 182-day bill, investors tendered GH¢1.28 billion, but only GH¢526.44 million was accepted.
The 364-day Treasury bill also recorded significant investor demand, attracting GH¢4.93 billion in bids. The government, however, accepted just GH¢289.70 million.
The limited acceptance of bids, particularly for the longer-dated instruments, contributed to further declines in Treasury bill yields.
The yield on the 91-day bill fell by 16 basis points to 5.46 per cent from 5.62 per cent at the previous auction.
Similarly, the 182-day bill yield declined by 25 basis points to 7.27 per cent, while the 364-day bill recorded the biggest drop, falling by 48 basis points from 12.98 per cent to 12.50 per cent.
The latest auction highlights a combination of strong investor confidence in government securities and a measured borrowing strategy by the government.
The gap between the amount investors were willing to provide and what the government ultimately accepted suggests that the sovereign was under less pressure to absorb available funds, helping to strengthen downward pressure on yields.
For the next auction, the government plans to raise GH¢5.43 billion through the issuance of 91-day, 182-day and 364-day Treasury bills.
