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Finance | Newsletter

T-bills auction: government secures ¢3.37bn but at higher interest rates

Image credit: Jose Luis Magana/AP Photo

Government secured ¢3.37 billion from the sale of Treasury bills, about 22.45% oversubscription.

According to the latest auction of the short-term instruments by the Bank of Ghana, ¢2.086 billion was mobilised from the 91-day T-bill.

However, the government accepted ¢2.075 billion of the bills tendered.

Also, ¢876.6 million was obtained from the 364-day bill, out of which government accepted ¢875.68 million.

For the 182-day T-bill, the government accepted ¢398.65 million from a total bid of ¢415.55 million.

The data shows that investors are taking advantage of the high yield which will hurt the government in the future. Government is offering this rate because presently the treasury market is its only source of borrowing, hence the need to entice the market participants.

However, interest rates remained high, raising concern about the servicing of the debt instruments in six months or one year to come.

The interest rates are still hovering around 35%.

Whilst the yield on the 91-day bill went for 35.73%, virtually same as the past week, the 182-day T-bill was sold for 35.84%, higher than the previous week’s 35.81%. The yield on the 364-day bill, however, stood at 35.62%.

The Domestic Debt Exchange Programme ended on Friday, February 10, 2023, with the results expected to be announced this week.

 Any success will impact positively the domestic financial markets going forward.

SecuritiesBids Tendered (GH¢)Bids Accepted (GH¢)
91-day2.086 billion2.075 billion
182-day415.55 million398.65 million
364-day876.68 million875.68 million
   
Total3.37b billion3.34 billion
Target2.759 billion 

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DISCLAIMER: The Views, Comments, Opinions, Contributions and Statements made by Readers and Contributors on this platform do not necessarily represent the views or policy of Multimedia Group Limited.