T-Bill Auction Misses Target as Investor Demand Slumps

Investor appetite for government Treasury bills weakened significantly last week, with total bids dropping by 19.5 percent week-on-week to GH¢3.17 billion, even as yields showed slight improvement. The auction fell well below the government’s GH¢4.67 billion target, missing it by GH¢1.72 billion—an undersubscription rate of 32.19 percent. Of the bids received, about GH¢2.95 billion was accepted across the 91-day, 182-day, and 364-day instruments. The 91-day bill remained the most attractive to investors, drawing GH¢2.02 billion in bids, with GH¢1.99 billion accepted. The 182-day instrument recorded GH¢498.93 million in bids, out of which GH¢416.93 million was taken up. Meanwhile, the 364-day bill saw GH¢648 million tendered, with GH¢533 million accepted. This marks a notable decline compared to the previous auction, which recorded stronger demand with GH¢3.94 billion in bids and GH¢3.23 billion accepted. Interest rates, however, edged slightly higher across the curve. The 91-day bill held steady at 4.81 percent, while the 182-day yield rose by 9 basis points to 6.71 percent. The 364-day bill also increased by 7 basis points to 9.84 percent. Looking ahead, the government has raised its borrowing target to GH¢7.57 billion for the next auction, signalling increased short-term financing needs despite the recent dip in investor demand.