Short-term debt securities oversubscribed by GHS 51m, demonstrating strong investor demand
The recent issuance of short-term debt securities by the Government of Ghana has witnessed a remarkable oversubscription of GHS 51 million, signaling robust investor appetite in the market. Primary dealers submitted total bids amounting to GHS 2,333 million, surpassing the government’s auction target of GHS 2,282 million.
In an exceptional outcome, the government accepted all bids tendered for the three securities, with interest rates ranging from 25.2% for the 91-day T-Bill, 27.1% for the 182-day T-Bill, and 30.3% for the 364-day T-Bill.
This successful issuance of short-term debt securities underscores the government’s continuous efforts to manage the country’s financing needs and meet its budgetary requirements. The upcoming issuance of 91-day, 182-day, and 364-day T-Bills on August 4, 2023, forms a crucial part of this strategic approach, with the aim of securing GHS 2,261 million in fresh funding.
Despite facing challenges such as high inflation, a large fiscal deficit, and concerns over debt sustainability, the oversubscription of the recent debt securities highlights investors’ unwavering confidence in the Ghanaian economy. The government’s concerted efforts to address these challenges, including fiscal consolidation measures and support from international financial institutions, have played a significant role in maintaining investor interest in the country’s debt securities.
Moreover, the government’s ability to mobilize substantial funding through short-term debt securities is a testament to the strength of Ghana’s primary dealer network. This network facilitates the seamless issuance and trading of government securities in the domestic market, contributing to the overall success of the auction.
Looking ahead, the government’s commitment to managing fiscal and economic challenges effectively remains paramount. Ongoing structural reforms and prudent macroeconomic policies will be critical in sustaining investor confidence in Ghana’s debt securities and supporting the country’s long-term economic growth and development.
