- Ghana’s Fixed-Income Market Rallies on Short-Term Liquidity and Selective Bond Demand
Trading activity on the Ghana Fixed Income Market rose sharply on Wednesday, driven by a surge in Treasury bill transactions and selective demand for restructured government bonds.
Total market volume climbed to approximately GH¢2.58bn on September 30, from GH¢1.59bn in the previous session, representing an increase of nearly 62 per cent, according to GFIM trading data reviewed by NorvanReports.
The number of recorded transactions increased even more strongly, rising from 297 to 806. This represented a 171 per cent session-on-session increase and indicated that the expansion was not attributable solely to one or two large block trades.
Yet beneath the headline growth was a significant change in the composition of investor demand.
Treasury bills accounted for GH¢1.75bn, or almost 68 per cent of total market activity. This compared with GH¢527.81mn, about one-third of turnover,. in the September 29 session.
Bill trading therefore increased by more than 232 per cent in a single day, while the number of transactions rose from 227 to 761.
The figures point to a market becoming considerably more active at the short end of the government yield curve. Investors appear willing to deploy liquidity, but their preferred destination remains instruments offering short maturities, relatively predictable pricing and easier exit conditions.
This is not necessarily a sign of broad-based risk appetite. It may instead reflect a preference for liquidity at a time when investors are balancing declining inflation and lower short-term interest rates against currency, fiscal and reinvestment risks.
The most actively traded Treasury bill was the instrument maturing on December 7, 2026, which recorded volume of GH¢312.91m across 10 transactions. It closed at a yield of approximately 5.34 per cent and a price of GH¢99.01.
The instrument alone represented nearly 18 per cent of all Treasury bill activity during the session.
Other concentrated trades included GH¢121.69m in the November 30, 2026 bill and GH¢57.89mn in the December 14 maturity. The December 14 instrument, however, recorded 404 transactions, suggesting a much broader investor base than the relatively small number of transactions behind some of the day’s largest volumes.
That contrast is important. Large turnover can sometimes reflect institutional portfolio adjustments involving only a handful of counterparties. The 761 Treasury bill transactions recorded on Wednesday suggest that the rise in activity had greater breadth, even though a few securities continued to dominate by value.
While Treasury bills led the market, Domestic Debt Exchange Programme bonds remained the second-largest segment.
DDEP bond volume reached GH¢825.90mn across 33 transactions, down 17 per cent from GH¢996.39mn in the previous session.
The segment’s share of total market activity dropped from approximately 62.5 per cent on Tuesday to 32 per cent on Wednesday. This was less a collapse in DDEP demand than a consequence of the exceptional increase in Treasury bill trading.
Activity was again heavily concentrated in the 2029 DDEP bond carrying an 8.65 per cent coupon. The security recorded GH¢585.34mn across 11 transactions, accounting for almost 71 per cent of all DDEP bond volume and nearly 23 per cent of total market turnover.
Its closing yield declined by 22 basis points to 13.52 per cent, from 13.74 per cent in the previous session. The corresponding closing price increased to GH¢90.32 from GH¢89.92.
The combination of significant volume, a rising price and a falling yield suggests firm demand for the instrument. However, the concentration also shows that liquidity in the restructured bond market remains uneven.
Investors are not purchasing all DDEP maturities indiscriminately. They appear to be targeting particular points on the curve where maturity, coupon structure and potential price appreciation provide an acceptable balance.
The 2027 DDEP bond carrying an 8.35 per cent coupon recorded GH¢70.20mn in volume. Its yield fell by 29 basis points to 10.50 per cent, while its price increased marginally to GH¢99.20.
The 2028 security carrying an 8.50 per cent coupon attracted GH¢24.78mn, with its yield declining six basis points to 12.39 per cent.
Longer-dated securities produced a more mixed picture. The yield on the 2030 DDEP bond rose 87 basis points to 14.50 per cent, while its price fell to GH¢85.15 from GH¢87.22. The 2032 bond’s yield increased 38 basis points to 14.64 per cent.
By contrast, the 2037 bond yield fell 58 basis points to 14.92 per cent, while the 2038 maturity declined 23 basis points to 14.93 per cent.
The divergent movements suggest that the session did not produce a uniform rally across the DDEP curve. Rather, investors repriced individual maturities according to liquidity, duration and transaction-specific demand.
New government bond activity rose to GH¢600,000 from GH¢194,442, although the absolute size of the segment remained small relative to Treasury bills and DDEP securities.
All Wednesday’s new-bond volume was concentrated in the September 2030 government bond carrying a 12 per cent coupon.
Its yield fell sharply to 11.27 per cent from 11.95 per cent — a decline of 68 basis points — while the closing price increased to GH¢102.25 from GH¢100.14.
The movement points to strong demand, but it was generated by a single transaction. It should therefore be interpreted as a useful pricing signal rather than conclusive evidence of a broad rally in the new government-bond market.
A similar development occurred among old government bonds.
Total volume edged down to GH¢123,047 from GH¢128,241, but the January 2028 bond carrying a 21.75 per cent coupon again accounted for GH¢96,000.
Its yield dropped to 20.50 per cent from 22.50 per cent, while the price rose to GH¢101.24 from GH¢99.05. This represented one of the strongest yield movements of the session, although it was also based on a single trade.
The June 2029 bond moved in the opposite direction, with its yield increasing to 19.95 per cent from 18.54 per cent on unchanged volume of GH¢20,000.
These contrasting movements reinforce the fragmented nature of Ghana’s secondary bond market. Prices can adjust sharply where trading is thin, meaning that individual transactions may produce significant changes without establishing a market-wide direction.
Corporate bond turnover declined steeply to GH¢519,374 from GH¢3.66m, while the number of transactions fell from 10 to three.
Almost all activity was concentrated in two Ghana Cocoa Board securities. The August 2027 cocoa bond recorded GH¢509,687, while the August 2028 instrument attracted only GH¢9,687.
The decline in corporate trading suggests that investors’ increased activity was directed principally towards sovereign securities rather than being distributed across the wider credit market.
Sell-and-buy-back transactions also fell sharply, dropping from GH¢66.04mn to GH¢852,094. The number of transactions declined from 28 to five.
This may indicate that the September 29 session contained unusually large collateralised liquidity transactions which were not repeated on Wednesday. Consequently, the September 30 increase in overall market activity is more notable because it occurred despite the near disappearance of the previous session’s repo volume.
The September 30 session presents two competing signals.
The first is positive: turnover expanded materially, transaction numbers rose and yields declined on several actively traded government securities. This suggests that liquidity is available and that some investors are prepared to extend beyond Treasury bills into selected DDEP and conventional bonds.
The second is more cautious. Trading remains highly concentrated, corporate debt activity is thin and longer-dated yields moved in different directions. Investors are participating, but they are doing so selectively.
In the near term, Treasury bills are likely to remain the market’s liquidity anchor. Their short maturities allow investors to earn a return without committing capital far along a yield curve that still carries fiscal, inflation and currency uncertainty.
Demand for DDEP bonds should persist, particularly in maturities where prices remain below par and yields provide a meaningful premium over short-term instruments. But the transition from selective bond buying to a broader market rally will require sustained turnover across more maturities, narrower pricing differences and greater participation outside a small number of dominant securities.
Wednesday’s GH¢2.58bn session therefore reflects an active market, but not yet a uniformly confident one. Investors are putting money to work; the composition of that activity shows that liquidity, selectivity and capital preservation continue to shape their decisions.
