T-Bill Auction Records First Undersubscription of GHS 1.04 Billion in Six Weeks
The Government of Ghana has missed its Treasury bill (T-bill) auction target of GHS 6.22 billion, securing GHS 5.17 billion in the November 15, 2024 auction.
This marks the first undersubscription of the short-term debt instruments following a five-week streak of oversubscriptions.
Despite the undersubscription, demand remained robust across all three tenors, with the 91-day bill leading with bids of GHS 3.94 billion.
The 182-day and 364-day bills also garnered investor interest, attracting GHS 653 million and GHS 584 million, respectively.
Yield Increases Across All Tenors
The auction recorded slight yield increases across all tenors:
- 91-day bill: Yielded 26.96%, up 0.14 percentage points from the previous auction.
- 182-day bill: Yielded 27.78%, marking a 0.11 percentage point rise.
- 364-day bill: Yielded 29.21%, a 0.09 percentage point increase.
Government’s Financing Strategy
With a challenging fiscal environment, the government remains reliant on domestic debt markets to meet its financing needs.
It plans to raise GHS 6.89 billion in the next auction, further emphasizing the importance of short-term debt securities in its borrowing strategy.
Continued investor interest in T-bills suggests resilient confidence in the government’s debt instruments, despite fiscal pressures.
However, the undersubscription highlights the difficulties in meeting ambitious targets amid rising yields and growing domestic debt obligations.
The performance of upcoming auctions will be closely watched as the government navigates its fiscal challenges.
