Treasury Bill auction sees 5.63% oversubscription amidst escalating interest rates
In the recent treasury bill auction conducted by the Bank of Ghana, the government observed a 5.63% oversubscription of sales, alongside a notable uptick in interest rates. The government managed to secure GHS 3.22 billion through the auction process.
Of the total bids submitted, approximately GHS 3.20 billion, or about 99% of the subscription, were accepted from the investor pool, largely composed of banks.
However, the escalation in interest rates raised concerns regarding the potential cost implications of servicing the debt instruments. The surge in interest rates was particularly evident across different tenures.
The yield on the 91-day bill increased by 0.31%, reaching 27.02%. Similarly, the 182-day bill experienced an uptick in yield to 28.61% from the prior rate of 27.88%.
The one-year bill saw an interest rate of 31.24%, up from its previous 31.08%.
Notably, a significant portion of the bids originated from the 91-day bill, amounting to GHS 2.36 billion, which the government accepted in full.
The 182-day bill attracted bids totaling GHS 717.51 million, with GHS 701.67 million being accepted. Bids for the 364-day bills reached GHS 146.20 million, and the government opted to accept GHS 143.20 million.
Looking ahead, the government outlined plans to raise a substantial GHS 38.959 billion in the third quarter of 2023 through the issuance of treasury bills.
These short-term instruments, available in 91-day, 182-day, and 364-day tenures, will be offered on a weekly basis to cater to the government’s growing liquidity requirements.
