Treasury Rates [March 4, 2024]

Security	Interest Rates
91 – Day Bill	26.9988%
182 – Day Bill	29.4965%
364 – Day Bill	30.0989%

Expectations of shocks to the inflation outlook following a third upward adjustment in the prices of petroleum products at the pumps with commercial transport operators warning of an impending upward review in transport fares failed to temporarily put a hold on the free fall of the yields on the government’s short-term papers as yields opened the new month extending its declining trajectory. Inflation picked up in January after months of staying on a declining trajectory as price pressures from non-food items rose by more than expected. Despite the prevalence of threats to the inflation outlook, it is expected that the government’s conscious efforts to drive down Treasury yields will be extended into the near future.

The rate of decline in the yield on the 91-day bill slowed this week to 28 basis points (bps) compared to last week’s 61 bps drop. It cleared at 26.9988% this week, down from 27.2829% posted last week.

The yield on the 182-day bill similarly fell by a smaller margin this week at 25 bps compared to last week’s 65 bps dip. It moved down from 29.7487% posted last week to clear at 29.4965% this week.

The 364-day bill posted a moderate drop this week at 20 bps, better than last week’s 60 bps decrease. It fell to 30.0989% this week, down from 30.2996% recorded last week.

Week-on-Week Change

Tenor	Previous	Current	w-o-w Change	w-o-w Change (%)	Year-to-Date
91 – Day	27.2829%	26.9988%	-0.28	-1.04%	-7.67%
182 – Day	29.7487%	29.4965%	-0.25	-0.85%	-7.49%
364 – Day	30.2996%	30.0989%	-0.20	-0.66%	-7.35%

Auction results of tender 1892 revealed that for the tenth consecutive time this year, investors continued to throng unto the government’s assets as yields remained comparatively higher with positive real returns. The government subsequently achieved an oversubscription rate of 20.0%.

A total of GHS 4,963.25 million worth of bids were tendered for the 91, 182, and 364 tenors against the government’s target amount of GHS 4,137.00 million. The government accepted all GHS 1,833.65 million and GHS 1,263.23 million worth of bids tendered for its 91-day and 364-day bills respectively and accepted 98.8% of the GHS 1,866.37 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 4,285.00 million from 91-day, 182-day, and 364-day bills to meet GHS 3.78 billion worth of maturing papers due next week.