T-bills: Government surpasses target by over GH¢400 million, interest rates rise

Treasury bills were oversubscribed in the latest auction held on July 7, 2023. According to the results from the Central Bank, the bills were oversubscribed by GH¢404.94 million.

The target for the auction was GH¢1.75 billion. However, the total number of bids that were accepted was GH¢1.97 billion.

The subscriptions for the auction held on July 7 were from the 91-day, 182-day, and 364-day bills.

Interest rates have steadily been rising in the past few weeks, even though Ghana has received the first tranche of the $3 billion IMF loan since May.

The increasing interest rates are a source of worry as the government will have to pay more in maturities.

For the 91-day bills, interest rates have increased from 23.95% to 24.39%, the 182-day bill increased from 25.79% to 26.02%.

The 364-day bill’s interest rates currently stand at 29.64%.

The majority of the subscriptions came from the 91-day bill but all bids tendered were not accepted.

Out of the GH¢1.63 billion bids tendered, GH¢1.54 billion bids were accepted. The 182-day bids accepted all bids tendered amounting to GH¢297.63 million and the 364-day bill accepted all bids worth GH¢137.89.

However, the government expects to raise GH¢1.778 billion from the 91-day bill, 182-day bill, and 364-day bill in its next auction.

The government had failed to meet the GH¢2.39 billion target set last week of GH¢500 million.

Last week’s target according to the Bank of Ghana included a sell buy-back of GH¢1.01 billion which matures and will be rolled over July 6, 2023.

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