Treasury Rates [March 21, 2022]

Security	Interest Rates
91 – Day Bill	13.4152%
182 – Day Bill	13.6095%

Ahead of the announcement of the policy rate later in the day where it is widely anticipated that the Monetary Policy Committee would hike the prime rate by at least 100 basis points (bps) to restore confidence in the economy, short-term bills gained favourably in tandem with the general expectation of an upward adjustment in the cost of credit as inflation climbs to multi-year highs. Calls on the central bank to tighten the policy rate has intensified in recent times on the back of capital flight as offshore investors repatriate their investments to take advantage of rate hikes in the developed economies.

The yield on the 91-day bill stayed on its impressive run as it gained by 16 bps this week to build on last week’s 11 bps gain. It rose from 13.2539% to 13.4152%, gradually inching closer to the prevailing yield on the 182-day bill.

The 182-day strengthened for the tenth consecutive time this week as it added a 6 bps gain to last week’s 18 bps jump. It cleared at 13.6095% this week, its highest since mid-April, 2021, up from 13.5524% posted last week.

Week-on-Week Changes

Term	Previous	Current	w-o-w Change	w-o-w % Change	Year-to-Date
91 – Day	13.2539%	13.4152%	0.16	1.22%	7.10%
182 – Day	13.5524%	13.6095%	0.06	0.42%	3.01%

Auction results from the Bank of Ghana (BoG) tender 1790 indicated that investors continued to throng on government assets as rates continue to move favourably on the back of expectations of higher inflation figures.

A total of GHS 1,178.22 million worth of bids were tendered for the 91-day and 182-day bills against the government’s target amount of GHS 1,041.00 million. The government accepted all bids tendered.

In the week ahead, we expect the government to raise a total of GHS 2,210.00 million from 91-day, 182-day, and 364-day bills. Later in the month, we also expect the government to return to the domestic market to raise a total of GHS 800 million from 10-year paper.