Gov’t borrows GHS 15.6bn via T-Bills in April; misses monthly target amidst declining yields
In the month of April 2024, the Government through the issuance of treasury bills, raised GH¢15.60 billion.
This figure represents a notable decline of 21.61% compared to March 2024.
Despite the substantial borrowing, the government’s performance fell short of expectations, with four out of five auctions settling below targets.
Such underperformance saw the government miss its gross monthly target by 9.73% and fall 3.90% below the matured bills.
However, amidst these challenges, the government remained steadfast in its aim to reduce T-bill yields.
Throughout April, yields witnessed a downward trajectory, with the 91-day bill shedding 45 basis points to close at 25.55%.
Similarly, the 182-day and 364-day yields recorded losses of 85 basis points each, culminating at 27.65% and 28.25%, respectively.
This concerted effort to trim yields occurred against a backdrop of inflationary risks stemming from recent hikes in fuel and transport prices.
Despite these pressures, analysts maintain an optimistic outlook, foreseeing favorable inflation dynamics that could bode well for treasury yields in the money market.
In a noteworthy turn of events, T-bills were oversubscribed in the most recent money market auction, with total bids surpassing the treasury’s target.
Accepting all bids worth GH¢3.47 billion, the treasury exceeded the auction target by 17.07% and matured bills by 26.74%.
This oversubscription was accompanied by a continued decline in yields, with the 91-day bill decreasing by an additional 10 basis points to 25.45%.
As the government navigates the intricate dynamics of borrowing and market sentiment, April’s treasury bill activity underscores a nuanced interplay between fiscal strategy, market conditions, and investor sentiment, shaping Ghana’s financial landscape in the months ahead.
