Treasury Rates [July 29, 2024]

Security	Interest Rates
91 – Day Bill	24.7879%
182 – Day Bill	26.7415%
364 – Day Bill	27.8562%

The yields on the government’s short-term securities appear to be nearing a turning point after staying on a protracted downward trajectory as rates over the past few weeks remain sticky downwards. Treasury bill rates came in mixed at last Friday’s auctions with the yield on the 91-day bill remaining unchanged while those on the 182-day and the 364-day bills registered an uptick. This week’s Treasury performance comes on the heels of the mid-year budget statement where the market interpreted the absence of additional taxes to mean that the government will likely increase its borrowings on the Treasury market.

The 91-day bill maintained its relative stability seen over the past few weeks as it remained unchanged this week at 24.7879% after posting a tiny decrease last week.

The yield on the 182-day bill recovered from last week’s 3 basis points (bps) this week. It moved up from 26.7129% posted last week to clear at 26.7415% this week.

The 364-day bill came in as the star performer for the week, gaining by 5 bps to build on last week’s 2 bps gain. It rose from 27.8075% posted last week to clear at 27.8562% this week.

Week-on-Week Change

Tenor	Previous	Current	w-o-w Change	w-o-w Change (%)	Year-to-Date
91 – Day	24.7879%	24.7879%	0.00	0.00%	-15.23%
182 – Day	26.7129%	26.7415%	0.03	0.11%	-16.13%
364 – Day	27.8075%	27.8562%	0.05	0.18%	-14.25%

Auction results of tender 1913 showed that the market remained skeptical about the government’s recent increased borrowings. Demand therefore failed to meet the government’s target amount for the third consecutive time with the government receiving a subscription of 85.0% of its target amount.

A total of GHS 4,062.11 million worth of bids were tendered for the 91, 182, and 364 tenors against the government’s target amount of GHS 4,779.00 million. The government accepted all GHS 2,404.71 million, GHS 1,179.82 million, and GHS 477.58 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 4,363.00 million from 91-day, 182-day, and 364-day bills to meet GHS 3.37 billion worth of maturing papers due next week as well as to create buffers for the upcoming interest payments on the DDEP bonds.