The government has once again missed its target for the sale of short-term instruments to domestic investors, falling short by approximately GH¢1,257.90 million.
According to the latest data from the Bank of Ghana, investor interest in T-bills declined during the most recent money market auction, with total bids reaching GH¢5.3 billion, compared to a target of GH¢6.55 billion.
A significant portion of the bids focused on the 91-day bills, with all GH¢4.1 billion tendered being accepted. The government also accepted bids worth GH¢967 million for the 182-day bill and GH¢231.14 million for the 364-day bill.
Overall, the auction resulted in a 19.15 percent undersubscription, as interest rates on the money market, averaging between 24 and 27 percent, continued to decline.
The data shows a slight increase in interest rates due to tightening liquidity. The yield on the 91-day bill rose to 24.825%, up from 24.820% the previous week. The 182-day bill yield increased to 26.764% from 26.76% in the prior week. The 364-day bill yield remained relatively stable at 27.857%, compared to 27.85% the previous week.
Market analysts attribute this trend to the government’s large auction target and its recent decision to keep yields stable to reduce future debt servicing costs.
Looking ahead, the treasury plans to raise its borrowing target to GH¢4.97 billion in the next T-bill auction.
Source: Adomonline
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