Ghana’s Treasury bill market is showing signs of strain as investor demand weakens, leading to repeated under-subscriptions and gradual increases in yields.
According to the Bank of Ghana, auctions over the past six weeks have consistently fallen short of targets, reversing a long period of strong investor appetite earlier in the year.
Market analysts attribute the shift to several factors, including investor preference for short-term liquidity, expectations of higher yields, and tighter liquidity conditions driven by central bank operations.
Demand has been heavily skewed toward 91-day bills, with investors avoiding longer maturities due to uncertainty around inflation, fiscal risks, and macroeconomic conditions.
At the same time, portfolio rebalancing is underway, with investors moving funds into bank deposits, equities, and longer-dated bonds offering higher returns.
The impact is already visible in yields, which have edged upward across all tenors. However, increases have been gradual, suggesting that the government is managing supply carefully to avoid sharp rises in borrowing costs.
Analysts warn that if the trend continues, it could lead to higher financing costs and force adjustments in debt strategy. For now, the developments signal a more cautious and price-sensitive investor environment rather than a full-scale market disruption.
Source: Toma Imirhe / businesspostonline
