The government’s efforts to meet its auction targets continue to be hampered by dampening liquidity in the money market, resulting in a shortfall of GH₵755 million this week.

According to the latest auction results from the Central Bank, the government raised GH₵4.89 billion from its short-term instruments, falling short of its GH₵5.60 billion target. This represents an undersubscription of approximately 13.47%.

In detail, the government accepted all GH₵3.9 billion tendered for the 91-day bills and the GH₵748 million offered by investors for the 182-day bills. For the 364-day bill, bids totaling GH₵197 million were also fully accepted.

Yields on treasury bills experienced a slight increase, with interest rates now averaging between 24% and 27%. Specifically, the yield on the 91-day bill rose by 0.02% to 24.90%, while the 182-day bill held steady at 26.78%.

The 364-day bill yield edged up by 0.01% to 27.91%.

Market analysts attribute this trend to the high auction targets set by the government. The Treasury plans to raise its borrowing target to GH₵5.4 billion in the upcoming T-bill auction.

Government borrowing on domestic market too high – IEA

T-bills auction: Gov’t target falls short again; interest rates up marginally