Government Declines Over GHS10bn in Bids as Demand for T-Bills Increases

Investor interest in Treasury bills (T-bills) continues to rise, with the government successfully surpassing its target for T-bill issuance, while also rejecting more than GHS 10 billion in bids. Last week’s auction saw the government raise more than GHS 7.73 billion in Treasury bills, exceeding the target by GHS 1.9 billion, despite receiving a total of GHS 9.6 billion in bids.

The Bank of Ghana’s latest auction results revealed that the government had initially aimed to raise GHS 7.73 billion but ended up receiving bids that far surpassed the goal by 165%. Bids for the 91-day and 182-day T-bills were particularly strong, reaching GHS 7.38 billion and GHS 5 billion, respectively. From these, the government accepted GHS 4.23 billion for the 91-day bills and GHS 1.43 billion for the 182-day bills. Bids for the 364-day T-bill totaled GHS 8.11 billion, with the government accepting GHS 3.96 billion of those.

Despite the high demand for these short-term debt instruments, interest rates saw a decline. The 91-day T-bill rate dropped to 24.47%, down from 26.85%, while the 182-day bill fell to 25.38%, down from 27.80%. The rate for the 364-day bill also decreased to 27.29%, down from 29.07%.

The government continues to show strong confidence in the market as it seeks to manage its debt obligations. Looking forward, the government plans to raise an additional GHS 6.49 billion through the next T-bill auction, scheduled for Friday, February 28, 2025. This indicates continued investor demand and the government’s ongoing efforts to manage public finances amid fluctuating market conditions.