Central Bank issues two debt instrument; gulps GHS 7 billion
The Bank of Ghana (BoG) raised some GHS 7.09 billion from the issuance of two 56-day bills last week.
The bills were auctioned by the Central Bank on Monday, March 11, 2024, and Wednesday, March 13, 2024.
Respectively, some GHS 4.12 billion and GHS 2.96 billion were raised from the two debt instruments.
The bills, per the auction results from the BoG, were each auctioned at an interest rate of 28.9 percent.
The auction results, however, did not indicate the value of bids made by primary dealers as well as the target of the BoG.
Central Bank bills – in this case BoG bills – mostly employed through Open Market Operations (OMO), serve as a monetary policy tool used by Central Banks to regulate the money supply in an economy.
The main function of Central Bank bills is to manage the liquidity of the banking system through selling short-term securities on the primary market.
In most cases, funds raised from the auction of the BoG bills are directly loaned to the government to support its short-term needs.
The interest rate on the Central Bank bills is the key interest rate that determines the monetary policy stance or rate.
