Oforiwaa Attipoe
Ghana’s declining interest rates are playing a key role in the government’s debt management strategy, according to Oforiwaa Attipoe, Manager of Global Market Sales for Ghana at Stanbic Bank.
Speaking in an interview with CNBC Africa on Ghana’s fixed income and foreign exchange (FX) market trends, she emphasized that the sustained drop in interest rates has created opportunities for strategic debt refinancing and cost reduction.
Since the beginning of the year, Ghana has seen a consistent downward trend in interest rates, a pattern that has continued under the country’s new administration. The latest treasury bills (T-bills) auction attracted unprecedented investor interest, with total bids reaching an all-time high of GH¢20.49 billion, marking a 140.5% oversubscription rate. Despite this overwhelming demand, the government accepted only GH¢9.634 billion in bids, reflecting a calculated approach to managing borrowing levels.
Year-to-date, the government has successfully raised approximately 65 billion cedis through weekly T-bill auctions. Interest rates for different tenors have witnessed a notable decline, dropping by about 4% across the board. Currently, the 91-day T-bill is trading at approximately 20.7%, the 182-day at 22.9%, and the 365-day at 22.6%. The government’s concerted debt management strategy, aimed at reducing borrowing costs, has been a key driver of this trend.
The stability of the cedi, according to Oforiwaa Attipoe, “Can be attributed, in part, to the Bank of Ghana’s market interventions, which have amounted to $994 million. These efforts have helped cushion the local currency against excessive depreciation and ensured a level of confidence among market participants.”
Ghana’s recent T-bill auction and FX market trends underscore a strategic shift in economic policy aimed at fostering stability, reducing borrowing costs, and bolstering investor confidence. As the government continues to refine its monetary and fiscal policies, market participants will be keenly watching how these developments unfold.
The coming months will be critical in determining whether the current strategies will yield the intended results of inflation control, sustained investor confidence, and overall economic resilience.
By Oforiwaa Attipoe, Sales Manager, Global Markets, Stanbic Ghana