Treasury Rates [January 23, 2023]

Security	Interest Rates
91 – Day Bill	35.6342%
182 – Day Bill	35.8066%
364 – Day Bill	35.5596%

Short-term Treasury yields came in mixed this week as yields struggle to continue the big moves observed in the later part of last year. Yields have widely stayed on a choppy path in 2023 despite the recent uptick in the latest inflation reading where the inflation rate inched up further to close 2022 at 54.1%, up from 50.4% in November last year. The relatively stable performance of Treasury papers comes amidst lingering uncertainties clouding the fixed income space as the government struggles to push through with its Domestic Debt Exchange (DDE) programme.

The yield on the 91-day bill was the lone gainer at last Friday’s auction, as it climbed up by 17 basis points (bps) to recover part of last week’s 20 bps decline. It moved up from 35.4643% posted last week to clear at 35.6342% this week.

The 182-day bill fell for the third consecutive time this week, adding 3 bps loss to last week’s 11 bps dip. It cleared at 35.8066% this week, from 35.8332% posted last week.

After last week’s marginal gain of 2 bps, the 364-day bill fell by the most at 36 bps loss to move from 35.9152% posted last week to clear at 35.5596% this week.

Week-on-Week Changes

Tenor	Previous	Current	w-o-w Change	w-o-w % Change	Year-to-Date
91 – Day	35.4643%	35.6342%	0.17	0.48%	0.77%
182 – Day	35.8332%	35.8066%	-0.03	-0.07%	-0.48%
364 – Day	35.9152%	35.5596%	-0.36	-0.99%	-0.93%

Auction results of tender 1834 indicated that after the recent streak of oversubscriptions, demand fell below the government’s ambitious target as investors assesses the likelihood of short-term papers being included in the DDE program.

A total of GHS 1,930.74 million worth of bids were tendered for the 91, 182, and 364 tenors against the government’s target amount of GHS 2,415.00 million. The government, constrained by a tight fiscal space, subsequently accepted all bids tendered.

In the week ahead, we expect the government to return to the domestic market in an attempt to mobilize GHS 1,278.00 million from 91-day, 182-day, and 364-day bills.