It was a disappointing week for the Government of Ghana as it trailed its treasury bills target by approximately Gh¢221.48 million at the recent auction held on Monday, 6^th December 2021. The amount fell short of the target of GH¢1,284.00 million by 16% as the government auctioned total bills to the tune of GH¢1072.52 on Monday.

According to the statistics from the Bank of Ghana, the Government of Ghana accepted GHc977.45 million from 91-day T-Bills and Ghc95.07 million from 182-day T-Bills.

Treasury bills are a key financial instrument that helps the government finance the national debt, thus the recent drop in expectations might alarm stakeholders and policy analysts. It may have also pushed the government’s debt management program off track.

The government actually accepted all of the investor bids, despite the fact that they were insufficient to quench the government’s financial hunger. The majority of the investors were financial institutions, particularly banks.

Specifically, Ghc977 million was tendered for the 91-day treasury bill. This means no oversubscription or undersubscription. The government accepted the full amount of the bids tendered but still yearned for more as it failed to reach its target for the three-month bill. The 91-day bill was auctioned at 12.48%, denoting a marginal decrease in the interest rate for the previous November 29th auction of 12.5%. The lowest rate for which investors were willing to trade for the bill was 12.5% and the highest those subscribers were willing to trade for the bill was 12.53%.

For the six-month bill, GH¢95.07 million was tendered and all the total amount was accepted. The six-month bill was auctioned for 13.17 percent of its face value. The lowest rate at which investors were willing to trade for the bill was 12.99 percent, while the highest rate at which they were willing to trade was 13.24 percent.

However, there were no bids tendered in for the 364-day investment bill and so, no bids were accepted.

Moreover, the 2-year Foreign Exchange rate (FXR) was tendered for GH¢1.7bn with all bids accepted by the Central Bank. The bill was auctioned at 19.75 %. Per BOG’s data, the lowest rate at which investors were willing to trade for the bill was 19 percent, whiles the highest rate at which they were willing to trade was 19.75 percent.

Discounted rates for the investment bills

The discounted rate, the amount investors get when they buy an investment bill, for the 91-day bill was 12.1 % as against 12.13% previously in November 29^th auction. The lowest discounted rate for the 91-day bill was 11.8 per cent and the highest for the bill was 12.15 percent for Monday’s auction.

Additionally, the 182-day bill was auctioned at 12.35 per cent. The lowest discounted rate for the 182-day bill was 12.2 per cent and the highest for the bill was 12.42 per cent.

The Central bank announced that the government of Ghana’s total target for the 91-day bill, 182-day bill and the 364-day bill is GH¢775.00 million for next week.