Treasury Rates [April 25, 2022]

Security	Interest Rates
91 – Day Bill	16.7814%
182 – Day Bill	17.4243%
364 – Day Bill	19.6735%

The yields on the government’s short-term papers extended their gains this week with the 182 and 364 tenors hitting new multi-year highs. The 182-day and the 364-day bills came in strong breaking through the 17.00% and 19.00% levels for the first time in more than five years as upward price pressures continue to drive higher inflation expectations. The inflation rate in March printed at 19.4%, the highest in more than 10 years, driven largely by food, transport, and fuel costs. We expect Treasury rates to continue to tighten to par with inflation figures.

After a series of strong increases, the 91-day bill posted a moderate gain of 45 basis points (bps) this week with an impressive year-to-date gain of 34.0%. It cleared at 16.7814% this week, up from 16.3287% recorded last week.

The 182-day bill registered its biggest weekly gain in the first four months of the year, coming in with a 1.11 percentage points gain to send its accumulated gains in 2022 to 420 bps. Its yield rose from 16.3155% recorded last week to 17.4243% this week.

The 364-day bill soared by 82 bps this week adding onto last week’s 58 bps gain. It rose from 18.8513% recorded last week to 19.6735% this week.

Week-on-Week Changes

Term	Previous	Current	w-o-w Change	w-o-w % Change	Year-to-Date
91 – Day	16.3287%	16.7814%	0.45	2.77%	33.98%
182 – Day	16.3155%	17.4243%	1.11	6.80%	31.89%
364 – Day	18.8513%	19.6735%	0.82	4.36%	18.20%

Auction results from the Bank of Ghana (BoG) tender 1795 revealed that for the fifth consecutive time, the government failed to realize its target amount as hikes in the prices of goods and services increase investors’ expenditures on consumption.

A total of GHS 982.17 million worth of bids were tendered for the 91, 182, and 364 tenors against the government’s target amount of GHS 1,932.00 million. The government accepted all bids tendered for the 182-day and 364-day bills totaling GHS 865.49 million and accepted GHS 692.06 million worth of bids from GHS 692.36 million bids tendered for the 91-day bill.

In the week ahead, we expect the government to raise a total of GHS 907.00 million from 91-day and 182-day bills. Securities ranging from 2-year up to 6-year are tabled to be issued in the second quarter of the year.