T-Bills oversubscribed by GHS 589m; Gov’t exceeds target for four consecutive weeks
The 91, 182 and 364 day treasury bills auctioned by the Bank of Ghana (BoG) on behalf of the government, saw some GHS 2,405 million mobilised as credit from investors to the government.
The secured GHS 2,405 million was against a programmed auction target of GHS 1,816 million.
Government, in accepting the GHS 2,405 million bids tendered, exceeded its target by GHS 589 million.
0versubscription of government’s T-Bills is believed to be the result of the exemption of the short-term debt security from the Domestic Debt Exchange Programme.
This, however, came at an increased cost to the government in the form of higher interest rates.
Interest rates on the 91, 182 and 364 days T-Bills were 36.8%, 36.9% and 36.9% respectively.
This is the fourth time in a row that Government has exceeded its auction target.
The first time was four weeks ago when Government exceeded its target by GHS 487m mobilising some GHS 1.65bn in total bids.
The second was three weeks ago when Government mobilised funds in excess of GHS 2.39bn against a target of GHS 2.17bn.
The third was last two weeks when Government exceeded its target by GHS 896m mobilising some GHS 2,748 million in total bids.
Prior to that, the Government had for four consecutive weeks missed its auction targets.
Despite the increased interest rates on the 91, 182 and 364 day T-Bills, the interest rates are less than the country’s inflation rate which currently stands at 40.4%.
This implies that, returns on government short term debt securities is still negative.
Meanwhile, government, in its next auction is aiming at raising some GHS 1,984 million from the issuance of the 91, 182 and 364 days T-Bills.
