GOVERNMENT SOLD a little above the target for its Treasury bills (T-Bills) auctioning, following months of under-subscriptions.
After its recent auctioning, government secured GH¢1.395 billion from the sale of the 91-day and 182-day T-bills, reaching nearly 14 per cent over subscription.
However, this came at a higher cost in order to achieve the target of GH¢1.228 billion.
But it was a necessary evil in order to attract the local investors, largely commercial banks.
According to the auctioning results, the 3-months bill was the financial instrument highly patronised, but at an interest cost of 22.57% with ¢1.22 billion mobilised from the sale of the short term instrument.
On the other hand, GH¢172.9 million was secured from the 182-day T-bills, but at an interest rate of 24.41%.
Currency analyst, Courage Martey, told the media he is unsure whether there will be regular over subscription of T-bills sale going forward.
“I don’t see much room to increase liquidity on the market in the near term because for as long as inflation continues to go up, the central bank cannot release liquidity on the market. This is because further liquidity on the market will only push inflation further up”.
“Because the central bank core mandate is to maintain price stability that means that in the interim we will have to prioritise the quest to restore low inflation. And to achieve that it requires keeping a firm grip on money supply,” he stressed.
By Jamila Akweley Okertchiri