The government has failed to meet its Treasury bill target by GH¢2.8 billion for the first time this year.
The government sought to raise GH¢6.14 billion through short-term instruments, according to data from the Bank of Ghana (BoG). However, bids totaling GH¢3.32 billion were received, indicating a 45% undersubscription.
Authorities turned down proposals totaling GH¢1.67 billion despite the gap.
According to the auction results, GH¢2.33 billion of the GH¢3.6 billion that was offered for the 91-day Treasury note was accepted. The 182-day bill received bids totaling GH¢741 million, of which GH¢574 million was approved. Only GH¢406 million of the GH¢622 million that was tendered for the 364-day bill was accepted.
In the meantime, Treasury bill interest rates, which ranged from 15% to 18%, stayed constant. From last week’s 15.88%, the 91-day bill fell 15 basis points to 15.73%.
The 364-day bill increased by 87 basis points to 18.85% from 17.98%, while the 182-day bill remained at 16.93%.
Because bids have been steadily declining over the last two weeks, market observers think the undersubscription was anticipated.
This indicates that as supply and demand stabilize, the market is getting closer to a yield equilibrium.
The Treasury hopes to generate GH¢5.64 billion at the next auction.
Source: newsthemegh.com