T-bills auction: Demand improves as government exceeds target by about 76%; interest rates soften
The Treasury, however, accepted GH¢4.40 billion of the total bids as against a target of GH¢2.86 billion.
The recent treasury bills auction saw a significant improvement in demand, surpassing the government's target by nearly 76.4% with a total of GH¢5.06 billion. Despite some analysts' predictions of relatively soft investor interest for the next auction, the Treasury managed to secure GH¢4.40 billion of the total bids, surpassing its initial target of GH¢2.86 billion.
The 91-day bill attracted the majority of the bids, with over GH¢3.2 billion tendered, accounting for 64.9% of the total bids. Out of this, GH¢3.0 billion was accepted. The 182-day bill received bids of approximately GH¢1.3 billion, of which GH¢1.257 billion was accepted. For the 364-day bill, bidding amounted to about GH¢468.9 million, with GH¢136.5 million accepted.
As a result of the strong demand, interest rates on the yield curve have softened, which will help reduce the government's cost of domestic debt. The yield on the 91-day bill decreased by 4.0 basis points to 4.60%, while the yield on the 182-day bill dropped by 1.0 basis point to 6.27% from the previous week's 6.31%. Similarly, the yield on the 364-day bill declined by 5.0 basis points to 9.75%.
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