In a remarkable end to the year, Ghana’s government has recorded a 9% oversubscription in its final Treasury bills auction for 2024, securing a total of GH¢4.6 billion.
This development comes amidst fluctuating investor confidence following the general elections.
The auction, which dominated the 91-day Treasury bill, attracted bids worth GH¢3.8 billion, while the 182-day bill contributed GH¢628.16 million, accounting for 13.5% of the total bids.
The 364-day bill brought in GH¢179.37 million, representing 3.36% of the total.
However, this marginal oversubscription came at a cost, as treasury bill rates saw another consecutive hike.
The interest rate for the 91-day bill edged up from 27.85% to 28.03%, while the 182-day bill rose from 28.68% to 28.88%. The 364-day bill also increased, moving from 29.97% to 30.07%.
This performance wraps up the year for the government’s short-term debt market strategy, setting the stage for 2025.
Treasury bills have become the government’s primary financing tool after losing access to international capital markets and facing successive sovereign credit downgrades.
In 2022, the government announced a domestic debt exchange program, which led to a stagnation in the local debt market. As a result, the government has relied heavily on treasury bills to finance its activities.
Looking ahead to 2025, Databank projects that the government may reduce T-bill issuances by up to GHS 20 billion, bringing the total stock to around GHS 200 billion.
This move is expected to be driven by the incoming administration’s commitment to fiscal consolidation.
President-elect John Mahama has signaled a strong commitment to reducing the country’s debt burden.
His administration plans to scrap the E-levy and COVID-19 levy, which could lower demand and yields for short-term instruments.
-BY Daniel Bampoe
The post Treasury Bills Gets 9% Oversubscription In 2024 Final Auction appeared first on DailyGuide Network.
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