Treasury bill target set to GH¢3.33 billion, part to be used to settle Pensioner bondholders

The government is targeting GH¢3.33 billion from treasury bills auction on May 12, 2023.

The target is expected to be generated from the 91, 182, and 364-day treasury bills.

According to reports, this will be used to refinance maturities worth GH¢2.31 billion.

The myjoyonline.com report stated that part of the ¢3.33 billion will be used to settle coupon payments of the pension bondholders.

There have been calls for the government to use treasury bills to pay pensioner bondholders. The pensioners have been calling on the government to pay their coupons and principals.

They have decided to picket at the Finance Ministry from Monday, May 9, 2023, till government pays them.

This week the government secured GH¢2.57 billion from the sale of treasury bills in the auction on May 5, 2023.

The auction saw an oversubscription of GH¢733.79 million even though interest rates have been rising.

The target for this week’s auction was GH¢1.83 billion. Also, interest rates have increased to an average of between 20.25% to 27.36%. According to the auction results from the Central Bank, the government secured GH¢1.63 billion from the 91-day bill, GH¢557.90 million from the 182-day bill, and GH¢380.75 million from the 364-day bill.

Interest rates, however, increased from 19.74% to 20.25% for the 91-day bill, 22.47% to 22.82% for the 182-day bill, and 26.9% to 27.36 for the 364-day bill.

By the end of April 2023, the government borrowed GH¢8.25 billion in treasury bills. These were used to refinance maturities worth ¢6.3 billion.

In April, the 91-day and 182-day yields saw an increase by about 19.95% (+56 basis points month-on-month) and 22.71% (+85 basis points month-on-month) respectively.

However, the 364-day settled at 27.26% (+160 basis points month-on-month).

Ghana is expecting a $3 billion bailout from the International Monetary Fund by May to boost its balance of payments.

SSD/FNOQ