Officials at the Ministry of Finance and the Bank of Ghana are considering closer coordination to address emerging liquidity pressures in Ghana’s domestic debt market, as repeated under-subscription of Treasury bill auctions raises concern.
Since mid-March 2026, government has struggled to fully meet its short-term borrowing targets, missing issuance goals in at least six consecutive auctions. The trend has sparked discussions about improving alignment between fiscal and monetary operations.
At the center of the issue is competition for liquidity between government Treasury bills and central bank-issued bills used for Open Market Operations (OMO). While Treasury bills fund government expenditure and debt refinancing, Bank of Ghana bills are deployed to manage liquidity and control inflation.
Recent data shows that even when investor demand appears strong, full uptake is not guaranteed. In one auction, bids narrowly missed the government’s GH¢4.475 billion target, with authorities accepting GH¢3.897 billion despite higher offers. Market participants say this reflects cautious allocation strategies rather than outright lack of liquidity.
The Bank of Ghana has significantly increased its liquidity absorption in 2026, mopping up nearly GH¢389 billion in the first quarter alone. Analysts say this has tightened conditions in the banking system, limiting the funds available for government securities.
Officials maintain that the central bank’s actions are necessary to maintain price stability, especially as inflation declines and monetary policy loosens. However, the overlap in issuance timing between BoG bills and T-bills has raised concerns about unintended market friction.
The planned coordination between the two institutions is expected to focus on harmonizing issuance calendars and managing liquidity more efficiently, with the aim of ensuring stable funding conditions for government while preserving macroeconomic stability.
By: Toma Imirhe / businesspostonline
