Treasury Rates [April 3, 2023]

Security	Interest Rates
91 – Day Bill	19.3881%
182 – Day Bill	21.8569%

Short-term Treasury bills rates went up this week in line with the recent hike in the monetary policy rate with the central bank tightening its tougher stance against red-hot inflation numbers. The central bank maintained that despite headline inflation recording an ease in the first two months of the year, inflation continues to remain relatively higher compared to the medium-term inflation target range of 6.0% to 10.0%. After the monetary policy committee announced a-150 basis points (bps) jump in the policy rate to 29.5%, it also reviewed other policy tools including resetting the cash reserve ratio on domestic deposits from 12.0% to 14.0% as additional policy tools to curb the inflationary trend. Going forward, we expect Treasury bills rates to stabilize around the current levels.

The 91-day bill came in as the star performer for the week as it climbed up by 51 bps to add to last week’s 35 bps increase. It cleared at 19.3881% this week from last week’s 18.8785% level.

The 182-day similarly recorded an uptick, inching up by 42 bps to trim its year-to-date decline to 39.25% from 40.41% last week. It moved up from 21.4392% last week to clear at 21.8569% this week.

Week-on-Week Changes

Tenor	Previous	Current	w-o-w Change	w-o-w % Change	Year-to-Date
91 – Day	18.8785%	19.3881%	0.51	2.70%	-45.17%
182 – Day	21.4392%	21.8569%	0.42	1.95%	-39.25%

Auction results of tender 1844 indicated that after last week’s sluggish demand for the government’s securities, interest rose this week on signs of rates picking up steam. Consequently, the government met its target as bids came 21.4% in excess of the intended target amount.

A total of GHS 1,624.84 million worth of bids were tendered for the 91 and 182 tenors against the government’s target amount of 1,338.00 million. The government, however, accepted GHS 1,244.14 million and GHS 355.13 million of the total bids submitted for the 91 and 182 tenors respectively.

In the week ahead, we expect the government to return to the domestic market in an attempt to mobilize GHS 1,767.00 million from 91-day, 182-day, and 364-day bills.