The appetite for government treasury bills (T-bills) remains robust, even as yields experience a steady decline. The latest auction results from the Bank of Ghana reveal a remarkable 43.85% oversubscription, underscoring sustained investor confidence in short-term government securities.
For this auction, the government targeted GH¢7.258 billion but successfully raised GH¢10.559 billion in total bids. Despite the overwhelming demand, only GH¢7.650 billion worth of bids were accepted, demonstrating a cautious approach to liquidity management.
Breaking down the results:
The 91-day T-bill led the charge, attracting over GH¢6.1 billion in bids, representing 58% of total submissions. The government accepted GH¢3.877 billion from this category.
The 182-day T-bill recorded bids of GH¢4.419 billion, with GH¢3.7 billion accepted.
Interestingly, there were no bids for the 364-day T-bill, signaling a preference among investors for shorter-term instruments in the current economic climate.
In a notable trend, interest rates declined for the second consecutive week. The yield on the 91-day T-bill dropped by 43 basis points to 27.98%, while the 182-day T-bill yield also fell slightly, closing at 28.68%, down from the previous 28.89%.
Auction Summary
Instrument Bids Tendered GH& Bids Accept
19 – Day -T – bill 6.139 billion 3.877 billion
182 – Day- T- bill 4.419 billion 3.770 billion
Total 10.559 billion 7.650 billion
The declining yields reflect the government’s success in securing funds at lower costs, a positive signal for fiscal management. However, the absence of bids for the 364-day bill may indicate investor caution regarding medium-term uncertainties.
The strong demand for T-bills amidst falling interest rates highlights their appeal as a secure investment option in the current economic environment.
Story by: Mercy Addai Turkson
