Gov’t T-Bills undersubscribed by GHS 776m in latest auction
In a disappointing turn of events, the Government of Ghana faced a setback as it missed its target in the auction of its 91, 182, and 364-day treasury bills on Friday, June 16, 2023. The T-Bills, which had a target of GHS 3,790 million, were undersubscribed by GHS 776 million, resulting in a total amount raised of GHS 3,014 million.
The Bank of Ghana (BoG) released the auction results report, revealing that primary dealers tendered bids amounting to GHS 2,394 million for the 91-day T-Bills. The government accepted all the bids received for this particular maturity.
For the 182 and 364-day T-Bills, bids reached GHS 521 million and GHS 99 million, respectively. Once again, the government accepted all the bids tendered for these shorter-term maturities. In total, the government was able to raise GHS 3,014 million from the auction, falling short of its target by GHS 776 million.
The undersubscription of the T-Bills auction suggests that investor demand was lower than anticipated, potentially reflecting cautious sentiment or alternative investment preferences. The government’s inability to meet its target may have implications for its budgetary planning and financing needs.
Despite this setback, the government is determined to raise the necessary funds and plans to make another attempt in the T-Bills market. On Friday, June 23, 2023, it will seek to raise GHS 2,202 million through a fresh auction. This upcoming auction will be closely monitored by market participants and analysts to gauge investor appetite and the government’s ability to meet its funding requirements.
The outcome of the next T-Bills auction will be crucial in determining the government’s ability to access the necessary capital to support its fiscal plans, including funding infrastructure projects and ensuring the smooth functioning of the economy.
As Ghana moves forward, market participants and investors will be keeping a close eye on the government’s efforts to mobilize funds and its overall fiscal management. The outcome of the upcoming T-Bills auction will provide valuable insights into investor confidence and the government’s ability to meet its financing needs in a challenging economic environment.
