Treasury Rates for March 8th 2021

Security	Interest Rates
91 – Day Bill	13.0488%
182 – Day Bill	13.8633%
364 – Day Bill	16.7571%
5 – Year Fixed Rate Bond	18.3000%

Ahead of the presentation of the 2021 budget statement to parliament later in the week where the government will be expected to articulate measures it intends to implement to steer the economy out of the ravaging impact of the COVID-19 pandemic to assure investors that their investments are safe, the yields on the government’s short-term assets further extended their downward trajectory. Strong demand for the government’s assets as investors continue to reaffirm their confidence in Ghanaian assets has sent Treasury yields lower despite expectations of higher inflation figures.

After recording a brief rise, the yield on the 91-day bill tumbled by 22 basis points (bps) this week to erase previous week’s 16 bps gain. It declined to 13.0488% this week from 13.2690% posted last week.

The yield on the 182-day bill weakened for the eighth consecutive time so far in 2021 as it declined by 3 bps to build on previous week’s 6 bps dip. It fell from 13.8917% recorded last week to 13.8633% this week, its lowest since September, 2018.

The yield on the 364-day bill similarly posted losses as it fell by 4 bps this week to 16.7571% from 16.7951% recorded last week.

Week-on-Week Changes for 1^st March, 2021

Term	Previous	Current	Change	Percentage Change
91 – Day	13.2690%	13.0488%	-0.22	-1.6595%
182 – Day	13.8917%	13.8633%	-0.03	-0.2044%
364 – Day	16.7951%	16.7571%	-0.04	-0.2263%
5 – Year	19.8500%	18.3000%	-1.55	-7.8086%

Auction results from Bank of Ghana (BoG) tender 1736 further showed a resounding massive expression of interest in government assets resulting in oversubscriptions in the weekly Treasury auctions.

A total of GHC 1,349.01 million bids were tendered for the 91-day, 182-day, and 364-day bills against the government’s target amount of GHC 1,252 million. The government, however, accepted GHC 1,331.15 million worth of the bids tendered.

A 5-year fixed-rate bond was also issued as part of the government’s domestic borrowing plan for the first quarter where the government sought to raise GHC 1,400 million through the domestic market. The long-term paper was oversubscribed by a little over 25% despite a decline in the yield from 19.8500% at its last issuance in 2020 to 18.3000%.

Next week, the government will be expected to reduce its intended target amount to raise a total of GHC 1,100.00 million from 91-day, 182-day, and 364-day bills.