The results of the forex forward rates auction held on Tuesday, October 6, 2020, showed that the7-Day tenor recorded the highest number of bids submitted.
According to the results presented by the Bank of Ghana, out of a total number of 91 bids submitted by banks, 47were 7-Day Tenor.
This means that the 7-Day tenor alone made up more than half of the total bids submitted bringing in approximately 51.6 percent of total bids submitted by the banks.
The report further indicated that the number of bids accepted totaled 42.
Out of the US$75.75 million worth of bids submitted, only US$25 million worth of bids were accepted, in keeping with the stipulated target.
Thus, the bids cover ratio was recorded to be 3.03×, meaning that the worth of total bids submitted was up to 3.03 times the stipulated target set by the Bank of Ghana.
A breakdown of the bids submitted by the banks provided in the report showed that except for the 15-Day tenor which came close to the 7-Day tenor by recording 31 bids, all the other Tenor with 30- and 45-Day tenor recording very low levels of 6 and 4 of bids submitted respectively and 60- and 75- Day tenor recording even lower levels of 2 and 1 of bids submitted in that order.
The report further asserted that even though the banks submitted up to 47 bids for the 7-day tenor, only 22 of the bids were accepted. In a similar vein, only a fraction of the bids submitted for the 15-Day tenor were accepted, with only 10 bids being accepted out of the total of 31 bids submitted.
In terms of rates, the 30-day tenor logged in the highest range of rates, reaching between 5.77 and 5.82 for bids submitted and 5.78 and 5.82 for the range of rates accepted. The remaining tenors also recorded a similar but marginally smaller range of rates. For example, the 15- day tenor had a range of rates for bids submitted extending from approximately 5.76 and 5.80 while its range of rates for bids submitted lay between about 5.78 and 5.80.
The range of rates for the 75-Day tenor was consistently the same throughout. The minimum rate submitted was about 5.8 and this figure repeated itself for the maximum rate submitted. A similar occurrence was noted in the column for the range of rates accepted as the same figure of approximately 5.8 was recorded for the minimum rate accepted and repeated yet again for the maximum rate accepted.
It must also be noted that some bids were put down as null and void. They were represented in the chart as invalid bids submitted and according to the Bank of Ghana’s statement, they were rendered inadmissible because they did not meet the forex forward auction guidelines. The number of bids ruled as invalid were reported to be worth a sum total of US$5.75 million.
