Government Saves Over GHS 1 Billion Following Decline in T-Bill Rates – Finance Minister Discloses
Minister for Finance, Dr. Cassiel Ato Forson, has disclosed that the recent decline in Treasury Bill (T-Bill) interest rates has resulted in savings of over GHS 1 billion for the government.
“Reduction in T-Bill interest rates has led to government saving over GHS 1 billion in interest payments, and that money can be channelled to critical areas of the economy,” he quipped.
He made the disclosure at the ongoing National Economic Dialogue (NED) at the Accra International Conference Centre (AICC).
The Finance Minister, in a tweet some days ago, noted that the decline in T-Bill interest rates was due to prudent public debt management strategies implemented by the government.
The Finance Minister noted that interest rates on short-term government securities have dropped significantly, falling by a cumulative 21.1% within the first 50 days of President John Mahama’s administration.
Providing a breakdown of the decline across all tenors, Dr. Forson stated;
- The 91-day T-Bill rate has fallen from 28.34% to 20.79%, a reduction of 760 basis points (7.6%).
- The 182-day T-Bill rate has dropped from 28.96% to 22.98%, reflecting a 600-basis-point (6%) decrease.
- The 364-day T-Bill rate has declined from 30.17% to 22.69%, marking a 750-basis-point (7.5%) cut.
He emphasized that the downward trend in rates signals growing investor confidence in Ghana’s economy.
The reduction in T-Bill rates is expected to lower borrowing costs for the government while potentially leading to reduced interest rates on loans in the broader economy.
Financial analysts suggest that the decline may be attributed to improved investor sentiment, fiscal consolidation efforts, and better liquidity conditions in the financial market. The development is seen as a positive step in the government’s strategy to manage public debt and stabilize the economy.
