The government has recorded a 9% oversubscription in its final Treasury bills auction for 2024, raising GH¢4.6 billion, surpassing the target of GH¢4.3 billion by GH¢383 million. This outcome reflects fluctuating investor confidence following the general elections.
The 91-day Treasury bill led the auction, drawing GH¢3.8 billion in bids, while the 182-day bill garnered GH¢628.16 million, representing 13.5% of total bids. The 364-day bill attracted GH¢179.37 million, accounting for 3.36% of the total.
Despite the oversubscription, Treasury bill rates saw consecutive increases. The interest rate for the 91-day bill rose from 27.85% to 28.03%, the 182-day bill increased from 28.68% to 28.88%, and the 364-day bill climbed from 29.97% to 30.07%.
The results highlight a combination of investor optimism and caution, as higher yields appear to be driving demand, even amid rising borrowing costs. This auction concludes the government’s short-term debt strategy for 2024 and sets the stage for 2025.
Treasury bills have become the government’s main financing tool following the loss of access to international capital markets and successive sovereign credit downgrades.
This shift was further exacerbated by the local debt market’s stagnation following the domestic debt exchange program announced in December 2022.
Databank in its 2025 outlook projects the government may reduce T-bill issuances by up to GHS 20 billion, bringing the total stock to around GHS 200 billion as alternative funding sources.
Meanwhile, the incoming administration of President-elect, John Mahama has signaled a strong commitment to fiscal consolidation, which could lower demand and yields for short-term instruments albeit with plans to scrap the E-levy and COVID-19 levy.
