Recent data from the Treasury indicate a decline in investor demand for Treasury bills last week, with the government missing its target by 2.11 billion cedis.
According to the Bank of Ghana, the Treasury accepted bids totaling 3.46 billion cedis against a target of 5.58 billion cedis, resulting in a 37.5 percent shortfall.
The 91-day bill attracted the highest demand, with the Treasury accepting 2.65 billion cedis out of the 2.66 billion cedis tendered.
The 182-day bill recorded 695 million cedis accepted from 705 million cedis submitted. Additionally, 116 million cedis was accepted on the 364-day note from 119 million cedis tendered.
Analysts attribute the undersubscription to limited liquidity among commercial banks, following the Bank of Ghana’s open market operation that absorbed nearly 19 billion cedis prior to the auction. They also note a persistent low demand for Treasury bills.
The shortfall resulted in a slight increase in yields across the curve. The yield on the 91-day bill rose by 5 basis points to 10.50 percent from 10.45 percent, the 182-day bill increased by 3 basis points to 12.39 percent from 12.36 percent, and the 364-day bill edged up by 1 basis point to 12.89 percent from 12.88 percent the previous week.
Looking forward, the government intends to raise 3.71 billion cedis in this week’s auction.
