Treasury records 8.2% undersubscription as rates continue to rise

Investor appetite for Government of Ghana short-term securities remained firm in the latest primary market auction, with fresh data from the Bank of Ghana showing the treasury receiving total bids of GH¢4.4 billion against a target of GH¢4.8 billion for the 91-day, 182-day and 364-day instruments.

Although the auction fell short of the target by about 8.2 percent, the government maintained a cautious acceptance strategy, taking up GH¢4.0 billion of the bids submitted.

The 91-day bill continued to dominate investor preference, accounting for more than half of total demand as investors leaned toward liquidity and lower risk. It recorded GH¢2.55 billion in bids, with GH¢2.54 billion accepted.

For the 182-day bill, bids came in at GH¢771 million, with GH¢758 million accepted, while the 364-day instrument attracted about GH¢1.1 billion in tenders, of which GH¢790 million was taken up.

Yields moved upward across all tenors, signaling tightening conditions in the money market. The 91-day bill inched up by 3 basis points to 4.94 percent from 4.91 percent the previous week. The 182-day bill rose by 13 basis points to 6.90 percent from 6.77 percent, while the 364-day bill climbed 15 basis points to 10.12 percent from 9.97 percent.

Looking ahead, the government has slightly lowered its borrowing target, setting a goal of GH¢4.47 billion for the next auction covering the same range of short-term securities.