T-bills oversubscribed by GH¢733 million despite increasing interest rates

This week the government secured GH¢2.57 billion from the sale of treasury bills in the auction on May 5, 2023.

The auction saw an oversubscription of GH¢733.79 million even though interest rates have been rising.

The target for this week’s auction was GH¢1.83 billion.

Also, interest rates have increased to an average of between 20.25% to 27.36%.

According to the auction results from the Central Bank, the government secured GH¢1.63 billion from the 91-day bill, GH¢557.90 million from the 182-day bill, and GH¢380.75 million from the 364-day bill.

Interest rates, however, increased from 19.74% to 20.25% for the 91-day bill, 22.47% to 22.82% for the 182-day bill, and 26.9% to 27.36 for the 364-day bill.

By the end of April 2023, the government borrowed GH¢8.25 billion in treasury bills.

These were used to refinance maturities worth ¢6.3 billion.

In April, the 91-day and 182-day yields saw an increase by about 19.95% (+56 basis points month-on-month) and 22.71% (+85 basis points month-on-month) respectively.

However, the 364-day settled at 27.26% (+160 basis points month-on-month).

Ghana is expecting a $3 billion bailout from the International Monetary Fund by May to boost its balance of payments.