Treasury bill auction undersubscribed by 29% as GH¢7.57billion target missed
Investor appetite for government debt weakened further at the latest Treasury bill auction, with the government missing its GH¢7.57 billion target by nearly 30 per cent, despite offering competitive interest rates across all three tenors.
According to the results of Tender 2002 released by the Bank of Ghana, total bids received amounted to GH¢5.3 billion, falling short of the target by approximately GH¢2.45 billion. Of the amount tendered, GH¢5.11 billion was accepted.
The 91-day bill remained the instrument of choice for investors, drawing GH¢4.44 billion in bids, of which GH¢4.43 billion was accepted. The 182-day bill recorded full uptake, with GH¢521.96 million both tendered and accepted.
However, demand softened considerably at the longer end of the curve. Of the GH¢348.94 million tendered for the 364-day bill, only GH¢162.59 million was accepted, underscoring the government's caution in locking in higher borrowing costs amid rising yields.
Yields edge up
Interest rates on government borrowing increased across the board. The 91-day bill rose by 10 basis points to 4.91 per cent, while the 182-day bill climbed 6 basis points to 6.77 per cent. The 364-day bill recorded the sharpest increase, rising 13 basis points to 9.97 per cent.
The range of accepted bid rates for the 91-day bill was between 4.55 per cent and 5.07 per cent, while the 182-day bill saw rates between 6.40 per cent and 7.25 per cent. The 364-day bill had a wider range of 9.17 per cent to 10.39 per cent, reflecting increased risk perception at the longer tenor.
The under-subscription raises fresh concerns about the government's near-term financing strategy. Compared to the previous tender held on April 2, 2026, where GH¢2.95 billion was raised from GH¢3.17 billion in bids, the latest results represent a significant ramp-up in borrowing ambition that was not met by investor demand.
Looking ahead, the government has set a lower target of GH¢4.89 billion for Tender 2003, suggesting a recalibration in response to prevailing market conditions.
For investors, the trend points to sustained opportunities in short-term instruments with relatively stable yields, while longer-dated securities may offer higher returns, albeit with greater risk and lower liquidity.