Trend in oversubscription of govt treasury bills to continue – Analyst predicts
Financial analyst, Courage Boti is predicting that government’s treasury bills will continue to be oversubscribed in the coming weeks.
This, he attributes to gains made by the government in its debts restructuring exercise.
The government has recorded an oversubscription of its treasury bill for two weeks in a row, with last week registering roughly 15.10 percent oversubscription.
According to the most current Bank of Ghana results, investors contributed slightly more than GHS 3.52 billion, compared to the government’s target of GHS 3.06 billion. This amounts to a 15.10% oversubscription.
Courage Boti in a Citi Business News interview outlined he circumstances that have led to this trend of oversubscription.
“Now government has paid coupons on the first DDEP bonds. It is the first step towards restoring confidence. We also know that government succeeded in rolling out pension funds into the DDEP and that settlement has begun; what this may mean is that there could be more activities on the secondary bonds market and evaluations turns out to favorable, you way witness some gradual activities returning to that segment of the market”, he said.
The figures from the Bank of Ghana showed that, a chunk of the bids came in from the 91-day bill. A total of GHS 2, 639.12 million was tendered by the investors for the 3-month financial instrument.
However, government accepted all the bids tendered.
Investors for the three-month financial instrument tendered majority of the bid with a total of GHS 2,639.12 million but government accepted all the bids.
The 182 – day bill also tendered GHS 650.63 million and same accepted however the 364 Day Bill tendered in GHS 237.08 million and government accepted all.
Meanwhile, interest rates on the money market continued to rise.
The 91-day T-bill increased to 27% from the 91-day T-bill increased to 27% from 26% last week.
Source: Ghana Business
