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T-bills auction: Government misses ambitious target by 15.9%; interest rates surge

Government missed its Treasury bills target by about 15.9%, following an ambitious target of ¢3.33 billion for the auction.

Interest rates, however, continued to surge, despite financing assurance to Ghana’s Creditor Committee under the G20 Common Framework.

According to auction results, the government secured ¢2.80 billion from the sale of the short-term securities.

Chunk of the bids came from the 91-day T-bill as a little above ¢2.31 billion were tendered. The government, however, accepted about 99% of the bids.

For the 182-day T-bill, the government got ¢355.2 million, whilst it received ¢116.60 million from the 364-day T-bill.  It accepted all the bids for both securities

The government had set an ambitious target to primarily resettle maturities worth ¢3.33 billion and use the rest to pay coupon payments of pension bondholders.

Meanwhile, interest rates surged marginally on the yield curve.

Whilst, the yield on the 91-day T-bill went up to 20.43%, from 20.25% that of the 182-day bill also inched up by 0.14% to 22.96%.

The rate for the 364-day bill stood at 27.59%.

Presently, the treasury market is the only source of borrowing for the government.

Securities Bids Tendered (GH¢) Bids Accepted (GH¢)  
91 Day Bill 2.311 billion        2.310
182 Day Bill 355.26 355.26
364 Day Bill 115.60 115.60
Total 2.802 billion 2.781 billion
Target 3.333 billion  

Source: Ghana News

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