Treasury Rates [May 20, 2024]

Security	Interest Rates
91 – Day Bill	25.0986%
182 – Day Bill	26.9497%
364 – Day Bill	27.9500%

Ahead of next week’s announcement of the monetary policy rate where the market is bracing up for either a monetary policy stay or a tightening on the back of the prevailing inflationary pressures, Treasury bill rates continued their relentless downward trend with the fiscal authorities seemingly embarking on strategies to reduce their interest costs. Inflation last month saw a marginal decline to 25.0% from 25.8% despite the expectations of higher inflationary numbers on the back of the free fall of the Cedi against its major trading partner currencies and as the prices of petroleum products tick upwards. It is expected that these developments will slow down the pace of the decline in Treasury yields in the near term.

The yield on the 91-day bill recorded a modest decline this week at 10 basis points (bps) drop compared to last week’s 25 bps dip. It cleared at 25.0986% this week from 25.1998% registered last week.

The 182-day bill was calmer this week with a dip of 5 bps compared to last week’s 40 bps drop. It moved down from 26.9995% recorded last week to 26.9497% this week.

The 364-day bill failed to build on last week’s tiny gain as it lost by 5 bps this week. It cleared lower at 27.9500% this week, down from 27.9999% posted last week.

Week-on-Week Change

Tenor	Previous	Current	w-o-w Change	w-o-w Change (%)	Year-to-Date
91 – Day	25.1998%	25.0986%	-0.10	-0.40%	-14.17%
182 – Day	26.9995%	26.9497%	-0.05	-0.18%	-15.47%
364 – Day	27.9999%	27.9500%	-0.05	-0.18%	-13.96%

Auction results of tender 1903 showed that the demand for the government’s short-term papers came in strong during last Friday’s auctions as real returns remained relatively positive. The government thus achieved a marginal oversubscription at a rate of 0.79%.

A total of GHS 3,212.12 million worth of bids were tendered for the 91, 182, and 364 tenors against the government’s target amount of GHS 3,187.00 million. The government accepted all GHS 2,493.30 million, GHS 636.63 million, and GHS 82.19 million worth of bids tendered for the 91-day, 182-day, and 364-day bills respectively.

In the week ahead, we expect the government to return to the domestic market in an attempt to mobilize GHS 4,865.00 million from 91-day, 182-day, and 364-day bills to meet GHS 4.06 billion worth of maturing papers due next week.