Government of Ghana records 6th consecutive T-bill undersubscription in April 24 auction

Government of Ghana’s struggles in the domestic debt market continued as its latest Treasury bill auction on April 24 ended in a sixth consecutive undersubscription.

Seeking to raise GHC4.475 billion to fund its operations and refinance maturing debt, government fell short of its target by 0.92 per cent.

As government targeted GHC4.475 billion, investors offered a total of GHC4.433 billion, but government ultimately accepted only 3.897 billion cedis across the three tenors.

The GHC577.9 million shortfall marks the 6th consecutive time this year that government has been unable to secure its full budgetary requirement from the Treasury bill market.

For the 91-Day Bill, government received bids totaling GHC2.756 billion, accepting GHC2.710 billion at a yield of 4.92 per cent.

The 182-Day Bill's offers reached GHC717.64 million, with government taking GHC664.37 million at an interest rate of 6.96 per cent.

The 364-Day Bill received bids amounting to GHC960.08 million, with government accepting only GHC522.48 million at a yield of 10.12 per cent.

While investors offered 98.08 per cent of the target amount, government only accepted about 87% of its original goal, with an undersubscription rate of 1.92 per cent.

This indicates that while the money was almost there, government likely rejected some bids, especially in the 364-day category, to avoid paying higher-than-desired interest rates.