Treasury Rates [September 25, 2023]

Security	Interest Rates
91 – Day Bill	28.5042%
182 – Day Bill	30.6791%
364 – Day Bill	32.5061%

Ahead of the announcement of the monetary policy rate later in the day where the market is bracing up for a possible policy stay buoyed by a much softer tone of the August inflation reading, Treasury bills rates continued their relentless upward path. Inflation in August slowed down to its lowest in eleven months as a significant number of items in the inflation basket recorded price declines in August with the month-on-month inflation figure recording a deflation. This development is expected to alter the direction of the policy rate which has been on an increasing trend over the past two years.

The yield on the 91-day bill climbed up by 38 basis points (bps) this week, adding onto last week’s 33 bps gain. It cleared at 28.5042% this week, up from 28.1201% posted last week.

The 182-day bill came in as the star performer for the week with a gain of 129 bps to outshine last week’s 27 bps climb. It moved up from 29.3936% recorded last week to hit 30.6791% this week.

The 364-day bill added 34 bps gain to last week’s 20 gain as it trimmed its year-to-date declines to 9.44%. It cleared at 32.5061% this week from 32.1700% posted last week.

Week-on-Week Changes

Tenor	Previous	Current	w-o-w Change	w-o-w % Change	Year-to-Date
91 – Day	28.1201%	28.5042%	0.38	1.37%	-19.40%
182 – Day	29.3936%	30.6791%	1.29	4.37%	-14.73%
364 – Day	32.1700%	32.5061%	0.34	1.04%	-9.44%

Auction results of tender 1869 revealed that after last week’s sluggish demand as investors assessed the impact of the new price developments on rates, demand rose this week to beat the government’s target amount. The government’s target amount was subsequently oversubscribed by 25.8%.

A total of GHS 3,251.42 million worth of bids were tendered for the 91, 182, and 364 tenors against the government’s target amount of GHS 2,585.00 million. The government accepted all GHS 433.28 million worth of bids tendered for its 364-day bill and 98.6% & 81.3% of the GHS 2,143.50 million & 674.64 million worth of bids tendered for its 91-day and 182-day bills.

In the week ahead, we expect the government to return to the domestic market in an attempt to mobilize GHS 2,570.00 million from 91-day, 182-day, and 364-day bills to meet GHS 2.40 billion worth of maturing papers due next week.