Dr. Ernest Addison, Governor, Bank of Ghana
GOVERNMENT EXCEEDED its Treasury bills target by 15.4 per cent recording GH¢1.72 billion in the latest treasury auction.
It, however, achieved the feat at the expense of keeping interest rates stable.
This is also coming despite the rising demand for the short-term instruments.
The auction results showed that the government got an extra GH¢350 million though it was expected to raise about GH¢1.49 billion to refinance Treasury bill maturities of GH¢1.37 billion.
It was, however, expected that interest rates would have fallen because of the rising demand for the short-term financial instruments.
Again, since the government’s only source of borrowing, for now, is the treasury market, ideally, demand for the treasury securities should have pushed the rates a little down.
Majority of the bids came from the 91-day T-bills, where a little over GH¢1.411 billion were received at a relatively same interest rate of 35.65 per cent from the previous week.
GH¢1.405 billion of the bids were, however, accepted.
For the 182 T-bills, GH¢311.91 million were tendered in by the investors, out of which GH¢270.32 million were accepted by the government.
The yield on the 182-day bill was also virtually unchanged at 35.94 per cent.
T-bill yields is expected to decline as an expected International Monetary Fund support-programme in the first quarter of this year coupled with a stable outlook of the cedi may limit currency pass-through to inflation.
BY Jamila Akweley Okertchiri