Treasury Rates [July 31, 2023]

Security	Interest Rates
91 – Day Bill	25.2417%
182 – Day Bill	27.1475%
364 – Day Bill	30.3060%

Treasury bills rates ticked up this week from previous week’s levels as yields on the government’s short-term securities extend their upward run buoyed by expectations of higher inflation numbers and as funding options for government spending remain skewed to domestic borrowing. This week’s Treasury performance comes after a monetary policy rate hike at the MPC’s July sitting last week where the central bank warned that Ghana’s macroeconomic framework requires decisive tightening from both the fiscal and monetary side to anchor inflation expectations. Presentation of the mid-year budget statement is due later in the day and the market will be on the lookout for the fiscal performance for the first half of the year and the outlook of fiscal performance for the second half of the year.

After weeks of slowing growth in the yield on the 91-day bill, the short-term paper this week cleared by a higher margin at 32 basis points (bps) compared to a jump of 23 bps last week. The paper rose to 25.2417% this week from 24.9211% posted last week.

The 182-day bill climbed up by 34 bps this week, adding onto last week’s 40 bps gain. It rose from 26.8064% posted last week to clear at 27.1475% this week.

The yield on the 364-day bill went up by 26 bps this week to trim its year-to-date decline to 15.57%. It cleared at 30.3060% this week, up from 30.0453% posted last week.

Week-on-Week Changes

Tenor	Previous	Current	w-o-w Change	w-o-w % Change	Year-to-Date
91 – Day	24.9211%	25.2417%	0.32	1.29%	–28.62%
182 – Day	26.8064%	27.1475%	0.34	1.27%	-24.55%
364 – Day	30.0453%	30.3060%	0.26	0.87%	-15.57%

Auction results of tender 1861 revealed that for the fourth time in a row, the government met its target as yields continue to improve. The government achieved an oversubscription rate of 2.6% this week, better than last week’s 1.7% oversubscription rate.

A total of GHS 2,342.06 million worth of bids were tendered for the 91, 182, and 364 tenors against the government’s target amount of GHS 2,282.00 million. The government accepted all GHS 1,996.92 million worth of the bids tendered for its 91-day and 182-day bills but accepted GHS 337.85 million out of the GHS 345.14 million worth of bids tendered for its 364-day bill.

In the week ahead, we expect the government to return to the domestic market in an attempt to mobilize GHS 2,261.00 million from 91-day, 182-day, and 364-day bills to meet GHS 2.13 billion maturing papers due next week.