The government’s latest treasury bills auction fell significantly short of its target, recording an undersubscription of about 55 percent, according to auction results released by the Bank of Ghana.
Out of a total target of GH₵6.58 billion, the government received bids amounting to GH₵2.92 billion, the lowest subscription level in several months. Despite the shortfall, the government accepted GH₵2.89 billion worth of bids across the 91-day, 182-day, and 364-day bills.
The breakdown of the auction results showed that GH₵2.08 billion was tendered for the 91-day bill, out of which GH₵2.08 billion was accepted. For the 182-day bill, investors tendered GH₵704.6 million, with GH₵699 million accepted, while the 364-day bill attracted GH₵136.5 million, of which GH₵110 million was accepted.
Meanwhile, interest rates on all three maturities rose marginally. The yield on the 91-day bill climbed to 29.69 percent, up from 29.53 percent the previous week. The 182-day bill increased to 32.43 percent, while the 364-day bill edged up to 32.92 percent.
Market analysts have attributed the undersubscription to tighter liquidity conditions within the banking sector and investors’ growing preference for higher returns amid rising inflationary expectations.
The shortfall contrasts sharply with the previous week’s performance, which saw a 23 percent oversubscription, indicating a sudden shift in investor sentiment.
Financial observers warn that continued undersubscription and rising yields could increase the government’s cost of borrowing and complicate its short-term debt management strategy.
