Treasury bill auction oversubscribed by 30.3% as investor demand rises

Investor demand for Ghana’s Treasury bills continued to strengthen at the latest primary market auction, with total bids significantly exceeding the government’s target for the three instruments.

Investors tendered a combined GH¢12.37 billion for the 91-day, 182-day and 364-day Treasury bills, while the government accepted GH¢11.55 billion.

With the government’s target set at GH¢9.49 billion, the auction recorded an oversubscription of approximately 30.3%, highlighting strong investor appetite for government securities.

The demand was particularly strong for the longer-dated 364-day Treasury bill, which attracted the largest share of investor interest.

The 91-day bill received bids worth GH¢2.95 billion, of which GH¢2.60 billion was accepted. The 182-day bill attracted GH¢1.31 billion in bids, with GH¢1.12 billion accepted.

The 364-day bill recorded the highest demand, attracting GH¢8.11 billion in bids, of which GH¢7.82 billion was accepted.

Yields were mixed across the curve. The yield on the 91-day bill remained unchanged at 5.78%, while the 182-day bill yield increased by one basis point to 7.68%, from 7.67%. The yield on the 364-day bill, however, declined by three basis points to 12.96%, from 12.99%.

Analysts attribute the strong investor participation to improved market liquidity and the attractive risk-free returns offered by Treasury bills, amid continued demand for relatively secure investment instruments.

The strong auction outcome comes as the government continues to rely on the domestic debt market to meet its financing requirements.

For the next auction, the government has set a target of GH¢5.87 billion across the 91-day, 182-day and 364-day Treasury bills.