Treasury Rates [June 19, 2023]

Security	Interest Rates
91 – Day Bill	21.6928%
182 – Day Bill	24.9747%
364 – Day Bill	28.9147%

Treasury yields this week responded positively to a surprising twist to the inflation outlook where the inflation rate upturned its recent easing trajectory to record its first increase in five months. Yields across the three tenors posted bigger margins of increase this week compared to its recent movements. Data released by the Ghana Statistical Service confirmed the lingering presence of upward price pressures on consumer goods and services as the inflation rate posted a 100 basis points (bps) increase from 41.2% in April to print at 42.2% in May. Month-on-month inflation rose to its highest in 2023 at 4.8% in May from 2.4% in April buoyed by significant price movements among food items. Treasury yields are anticipated to see a further upward shift in the near term on the back of renewed risks to the inflation outlook.

The 91-day bill went up by 42 bps to build on last week’s 11 bps increase. It moved up from 21.2694% posted last week to clear at 21.6928% this week.

After weeks of minimal increases, the yield on the 182-day bill posted an impressive gain to surge by 102 bps, the first of such increases in 2023. It cleared at 24.9747% this week from 23.9535% posted last week.

The 364-day bill came in as this week’s star performer with a jump of 109 bps to recover from last week’s 20 bps dip. It rose from 27.8200% posted last week to clear at 28.9147% this week.

Week-on-Week Changes

Tenor	Previous	Current	w-o-w Change	w-o-w % Change	Year-to-Date
91 – Day	21.2694%	21.6928%	0.42%	1.99%	-38.66%
182 – Day	23.9535%	24.9747%	1.02%	4.26%	-30.59%
364 – Day	27.8200%	28.9147%	1.09%	3.93%	-19.45%

Auction results of tender 1855 revealed that demand failed to reach the government’s ambitious target despite the recent upgrade in the ratings of Ghana’s local currency-denominated bonds. Bids tendered fell short of the government’s target amount by 20.3%.

A total of GHS 3,018.96 million worth of bids were tendered for the 91, 182, and 364 tenors against the government’s target amount of GHS 3,790.00 million. The government accepted GHS 3,015.74 of the total bids tendered.

In the week ahead, we expect the government to return to the domestic market in an attempt to mobilize GHS 2,202.00 million from 91-day, 182-day, and 364-day bills.