Amin Adam questions government bond pricing as short-term yields fall below inflation

Dr Mohammed Amin Adam, a former Finance Minister of Ghana, has raised concerns about the pricing of short-term government bonds, specifically the 91-day Treasury bill, which has fallen below the country’s inflation rate. The 91-day Treasury bill yielded 4.60% during the October 12, 2026 auction, which is lower than the inflation rate of 5.2% and the Bank of Ghana’s policy rate of 14%.

Additionally, it is significantly lower than the 10.50% yield on the central bank’s 14-day bill. Dr Amin Adam suggests that this discrepancy indicates that the short end of the yield curve is being driven by captive liquidity demand rather than the monetary stance, casting doubt on the reliability of government borrowing rates as a measure of credit and duration risks.

He advocates for coordination between the government and the Bank of Ghana in their issuance programs, better communication of the differences between their instruments, and the establishment of predictable calendars, transparent auction results, and market-based pricing to rebuild the yield curve.

Brief written by urgent.news from MyJoyOnline Ghana's own syndicated text. Machine-written — may contain errors; check the original before relying on it.