Treasury Rates [January 15, 2024]

Security	Interest Rates
91 – Day Bill	29.0399%
182 – Day Bill	31.5154%
364 – Day Bill	32.0833%

The persistent and sustained drop in the consumer price index continues to exert downward pressures on Treasury yields as the yields on the government’s shorter-dated papers fell this week, the third of such declines in a row. Despite Treasury rates trending high in most parts of 2023, the inflation numbers have been relatively higher, leading to negative real returns. However, with the recent sharp fall in the inflation rate as Treasury yields remain relatively sticky downwards, real returns have begun to turn positive. It is expected that this trend will persist in the short to medium term.

The yield on the 91-day bill fell by 15 basis points (bps) this week, adding onto last week’s 5 bps dip. It fell from 29.1902% posted last week to clear at 29.0399% this week.

The 182-day bill recorded its third consecutive decline this week, coming in with a dip of 23 bps. It fell to 31.5154% this week, down from 31.7437% posted last week.

The yield on the 364-day bill fell the most by 26 bps to widen its year-to-date performance to -1.24%. It weakened to 32.0833% this week from 32.3404% registered last week.

Week-on-Week Change

Tenor	Previous	Current	w-o-w Change	w-o-w % Change	Year-to-Date
91 – Day	29.1902%	29.0399%	-0.15	-0.51%	-0.69%
182 – Day	31.7437%	31.5154%	-0.23	-0.72%	-1.15%
364 – Day	32.3404%	32.0833%	-0.26	-0.79%	-1.24%

Auction results of tender 1885 showed investors thronging to the governments assets as real returns begin to creep in. Consequently, the government achieved an oversubscription at a rate of 46.8%, better than last week’s 13.6%.

A total of GHS 3,863.11 million worth of bids were tendered for the 91, 182, and 364 tenors against the government’s target amount of GHS 2,632.00 million. The government accepted all GHS 2,837.59 million and GHS 185.04 million worth of bids tendered for its 91-day and 364-day bills and accepted 99.8% out of the GHS 840.48 million worth of bids tendered for the 182-day bill.

In the week ahead, we expect the government to return to the domestic market in an attempt to mobilize GHS 3,058.00 million from 91-day, 182-day, and 364-day bills to meet GHS 2.85 billion worth of maturing papers due next week.