Investor interest in Treasury bills remained robust during the most recent primary market auction, with total bids significantly surpassing the government’s target.
The Bank of Ghana aimed to raise GH¢5.147 billion through the 91-day, 182-day, and 364-day Treasury bills for Tender 2022. However, investors submitted total bids amounting to GH¢12.35 billion, leading to an oversubscription rate of 139.9%.
Ultimately, the Treasury accepted GH¢6.53 billion of the submitted bids.
An analysis of the auction results indicates that investor demand was predominantly focused on the one-year instrument, with the 364-day Treasury bill representing approximately 60.8% of the total bids received.
The 364-day bill garnered GH¢7.50 billion in bids, of which GH¢2.75 billion was accepted, leaving nearly GH¢4.75 billion in bids unfulfilled.
The 182-day bill attracted bids totaling GH¢1.2 billion, with just over GH¢935 million accepted.
For the 91-day bill, GH¢3.5 billion in bids were submitted, and the Government accepted GH¢2.8 billion of those bids.
Yields continued to decline across the Treasury bill spectrum, reflecting strong market liquidity and persistent investor interest in government securities.
The yield on the 91-day bill decreased by 13 basis points to 4.94%, down from 5.07% at the previous auction.
In a similar trend, the yield on the 182-day bill fell by 23 basis points to 6.85%, down from 7.07%.
The 364-day bill experienced the most significant drop, with its yield decreasing by 82 basis points to 10.77%, down from 11.59%.
Looking forward, the government plans to raise GH¢6.554 billion through the issuance of 91-day, 182-day, and 364-day Treasury bills in its upcoming auction.
The results of the latest auction highlight the ongoing strong demand for government securities, offering the Treasury an opportunity to fulfill its borrowing needs at lower yields amidst high liquidity conditions in the market.
