Treasury Rates for February 14, 2022

Security	Interest Rates
91 – Day Bill	12.6853%
182 – Day Bill	13.2551%
364 – Day Bill	16.9873%
2 – Year Fixed Rate Note	19.7500%

This week, short-term Government of Ghana Treasury bills rates extended their winning streak after the inflation rate began the year hitting its highest in more than five years. Treasury yields have been on a continuous rise in the first six weeks of 2022 buoyed by rising consumer prices with the inflation rate on the ascendency since May 2021. The latest inflation figure released by the Ghana Statistical Service put the inflation rate at 13.9% as housing, water, electricity, gas & other fuels, and transport drove significant changes in the national inflation rate.

After recording a 3 basis points (bp) gain last week, the 91-day bill rose by 2 bp to send its accumulated gains to 16 bp. It cleared at 12.6853% this week, its highest since first week in June 2021 from 12.6645% recorded last week.

The 182-day bill recorded its fifth straight consecutive gain this week as it added 2 bp gain to last week’s 1 bp gain. It climbed from 13.2349% last week to 13.2551% this week.

The 364-day bill was the star performer for the week as it recorded an impressive 24 bp gain. It cleared at 16.9873% this week, from 16.7446% registered last week.

Week-on-Week Changes

Term	Previous	Current	w-o-w Change	w-o-w % Change	Year-to-Date
91 – Day	12.6645%	12.6853%	0.02	0.16%	1.27%
182 – Day	13.2349%	13.2551%	0.02	0.15%	0.33%
364 – Day	16.7446%	16.9873%	0.24	1.45%	2.06%
2 – Year	19.7500%	19.7500%	0.00	0.00%	–

Auction results from the Bank of Ghana (BoG) tender 1785 showed investors bullish towards the government’s short-term securities as they anticipate rising inflation to continue to push rates upwards.

A total of GHS 1,511.3 million worth of bids were tendered for the 91-day, 182-day, and 364-day bills against the government’s target amount of GHS 1,407.00 million. The government could only accept GHS 1,508.45 million worth of the total bids tendered.

The government also took to the domestic market to issue a 2-year paper in which it sought to raise GHS 1,400.00 million. Total bids tendered and subsequently accepted came in at GHS 1,082.42 million. The paper cleared at 19.75%, unchanged from the last issuance’s clearing rate.

In the week ahead, we expect the government to raise a total of GHS 664.00 million from 91-day and 182-day bills. Later in the month, we also expect the government to return to the domestic market to raise a total of GHS 1,200.00 million from a 7-year paper.