Ghana’s Treasury bills (T-bills) market, for now, is enjoying a clear resurgence, recording a fourth consecutive oversubscription, even as interest rates dipped across all three instruments.
This signals an elevated or strong investor appetite for government paper, which has been sustained for a month.
The last auction report published by the Bank of Ghana reveals that the government set a relatively modest target of GHC3.79 billion, but investors came in force, submitting bids worth GHC5.60 billion.
In the end, the government accepted GHC5.38 billion, translating into an oversubscription of GHC1.81 billion, or 47.7% above target.
What makes this performance striking is that it came despite declining yields on all instruments, suggesting that investors were willing to accept slightly lower returns in exchange for safety and liquidity.
From the report, the yield on the 91-day bill fell from 11.1108% to 11.0887%, attracting GHC2.54 billion in bids.
The 182-day bill also declined from 12.5421% to 12.4358%, drawing GHC1.52 billion of the total bids.
The rate on the 364-day bill also eased from 12.9704% to 12.9132%, with bids reaching GHC1.54 billion.
Market watchers believe that the relatively small borrowing target played a key role in driving the oversubscription. With limited supply on offer, competition among investors intensified, allowing the government to take in GHC1.59 billion more than planned, while rejecting only GHC0.22 billion in bids.
The sustained oversubscription streak is offering the government much-needed breathing room. Strong demand allows the Treasury to finance short-term obligations smoothly, reduce rollover risks, and manage cash flow pressures more effectively.
More importantly, the ability to attract excess funds while yields are falling helps contain borrowing costs, easing pressure on interest expenditure at a time when fiscal consolidation remains critical.
However, the persistent oversubscriptions could also encourage higher reliance on short-term debt, which, if not managed carefully, may raise refinancing risks in the future.
For now, the confidence in government securities is holding firm. Whether this momentum continues will depend on future auction targets, interest rate movements, and broader macroeconomic signals in the weeks ahead.
Meanwhile, the government plans to raise another less ambitious target of GHC3.3 billion in its upcoming auction this week.
