The renewed surge in U.S. Treasury yields above the psychologically important 5 percent threshold is beginning to change the risk-reward equation for investors holding Ghana’s restructured Eurobonds, although the impact so far has been considerably more nuanced than a wholesale flight from Ghanaian sovereign debt.
The benchmark 10-year U.S. Treasury yield rose above 5 percent on September 14, 2026, reaching about 5.01 percent, its highest level since October 2023. The immediate catalysts have included renewed inflation fears arising from the surge in oil prices, expectations of tighter U.S. monetary policy and concerns about the U.S. fiscal position and the heavy supply of Treasury securities.
For Ghana, the significance is straightforward: when an investor can obtain approximately 5% from the world’s benchmark risk-free dollar asset, the yield required to justify taking Ghanaian sovereign credit risk becomes more important. Unless Ghana Eurobond prices fall sufficiently to restore an attractive spread over Treasuries, demand for the bonds is likely to weaken, particularly at the shorter and intermediate maturities where current spreads have become unusually compressed.
To be sure, although there are no definite registry data available which states the proportion of Ghana’s outstanding Eurobonds held by locally domiciled institutions and high net worth individuals (HNWIs), it is widely understood that they account for a relatively small proportion – most of the Ghana Eurobonds in circulation prior to the 2024 restructuring were held by international investors such as BlackRock, Vontobel, AllianceBernstein, Neuberger Berman and PIMCO.
However, a significant amount of Eurobonds are still held by Ghanaian commercial banks, pension funds, insurers, fund managers and HNWIs.
Such local investors now face a loss of value on their holdings as their secondary market bond prices begin to fall in order to prop up the yields they offer, so as to retain a premium over the higher yields now offered by risk free US Treasuries.
A fall in Ghana Eurobond prices caused by the rise in U.S. Treasury yields has two quite different effects: it is largely a mark-to-market loss for existing Ghanaian investors. An institution that bought a Ghana Eurobond at US$90 and sees it fall to US$85 has suffered a US$5 loss in market value, equivalent to 5.6 percent of the original investment, even though Ghana has made no change to the contractual payment terms.
For investors required to mark portfolios to market, this immediately reduces reported asset values and potentially investment returns. But it does not automatically increase the Government of Ghana’s debt-service bill on the bonds already issued.
Why the market is likely to demand higher Ghana yields
The mechanics are straightforward.
Suppose an international investor considers a Ghana 2035 bond yielding 6.14 percent. If the U.S. Treasury benchmark is 4 percent, Ghana provides a spread of approximately 214 basis points.
If the Treasury rises to 5 percent, with Ghana’s yield initially unchanged, the spread falls to only about 114 basis points.
The investor therefore has three choices: accept the narrower spread, sell Ghana and buy US Treasuries, or demand a lower Ghana bond price—and consequently a higher Ghana yield—to restore the desired spread.
The third option is particularly important for the secondary market. Selling pressure pushes Ghana bond prices down. Because bond prices and yields move inversely, yields rise until the Ghana spread again becomes sufficiently attractive.
This is why the US Treasury shock can produce a Ghanaian yield increase even if nothing deteriorates within Ghana’s economy itself.
The effect should be strongest on longer-duration bonds. A rise in required yield produces a larger capital loss on a bond with more distant cash flows. The September 9-11 price movements already show this pattern: the 2037 bond’s price fell by about 1.2 percent, compared with less than 0.5 percent for the 2029 and 2030 securities.
By September, Ghana’s external sovereign curve had moved into territory that would have appeared almost unimaginable during the debt crisis, because Ghana’s Eurobonds have undergone a dramatic recovery since the completion of the external debt restructuring in October 2024.
The restructuring covered approximately US$13 billion of Eurobonds. Most participating creditors received new bonds maturing in 2029 and 2035, with a nominal haircut of about 37 percent, while some opted for 2037 bonds carrying a 1.5 percent coupon but no nominal haircut. All holders also received a 2026 down-payment bond and a 2030 post-default-interest bond.
By the end of 2025, the improvement in investor sentiment was already substantial. Ghana’s Ministry of Finance reported that outstanding Eurobonds had fallen to US$8.38 billion from US$9.24 billion at end-2024. More importantly, the weighted-average secondary-market price had risen by 19.1 percent during 2025, while the weighted-average yield had fallen by 338 basis points.
The end-2025 yields illustrate the magnitude of the recovery. The restructured 2029 bond was yielding approximately 6.7 percent, the 2030 bond 7.2 percent, the 2035 bond 8.3 percent and the 2037 bond 8.6 percent.
Those yields have subsequently fallen much further as Ghana’s macroeconomic position improved, the IMF programme progressed, debt restructuring was completed and the probability of another sovereign default declined.
The IMF’s latest assessment moved Ghana’s debt-distress classification from high to moderate, reflecting stronger fiscal performance, exchange-rate stabilization, economic growth and progress with debt restructuring.
Ghana has also strengthened its external-debt narrative by settling US$700 million of Eurobond obligations ahead of schedule in July. The transaction was another indication that the government was moving away from the liquidity crisis that had characterized the 2022-24 period. The July transaction represented another reduction in near-term external amortization risk.
By September, Ghana’s external sovereign curve had therefore moved into territory that would have appeared almost unimaginable during the debt crisis.
On September 9, indicative secondary-market pricing put the 2029 bond at a yield of 5.386 percent, the 2030 bond at 3.461 percent, the 2035 bond at 6.025 percent and the 2037 bond at 7.255 percent. Corresponding prices were 98.997, 89.259, 93.066 and 58.717 respectively.
By September 11, just before the U.S. 10-year Treasury broke decisively through 5 percent, Ghana’s indicative yields had risen to 5.560 percent for the 2029 bond (up 17.4 basis points), 3.629 percent for 2030 (up 16.8bps), 6.143 percent for 2035 (up 11.8bps) and 7.397 percent for 2037 (up 14.2bps). Prices had fallen to 98.558, 88.808, 92.310 and 58.003 US dollars respectively from the US$100 at which each was issued. All this over the space of just two days.
These movements should not be interpreted as being caused solely by the Treasury sell-off though. Ghana-specific developments, including the transition from the IMF’s financed Extended Credit Facility to a 36-month Policy Coordination Instrument, also affect the risk premium. Nevertheless, the timing provides clear evidence that Ghana’s bonds were already becoming more vulnerable as global dollar interest rates moved higher.
Ghana Eurobond spreads over US Treasury yields are the critical issue
The most important quantitative measure for international investors is not simply Ghana’s yield, but Ghana’s yield minus the comparable U.S. Treasury yield.
With the U.S. 10-year Treasury around 5.01 percent, the 2029 Ghana bond yielding 5.56 percent offers only about 55 basis points of additional yield over the U.S. benchmark.
The 2035 bond, at 6.14 percent, offers roughly 113 basis points, while the 2037 bond at 7.40 percent offers about 239 basis points.
That is a dramatic change from the end of 2025, when Ghana’s 2035 and 2037 bonds were yielding 8.3 percent and 8.6 percent respectively, while the U.S. 10-year Treasury was materially below today’s 5 percent level.
The implication is that much of the easy capital gain from Ghana’s recovery has already occurred. Investors who bought Ghana’s restructured bonds when they were deeply discounted have enjoyed substantial price appreciation and yield compression. At today’s prices, however, the compensation for remaining invested is considerably smaller.
This creates two opposing forces.
One the one side, Ghana’s credit fundamentals are substantially better than they were during the default and restructuring period. But on the other side, the global risk-free rate has risen so sharply that investors now have a much more attractive alternative in U.S. government securities.
The current situation should not be confused with Ghana’s 2022-23 debt crisis though.
The country’s Eurobond stock has been restructured; debt-service payments have resumed; the IMF has assessed debt distress as moderate rather than high; fiscal performance has improved; and the government has demonstrated its willingness and ability to make sizeable external debt payments. The Ministry of Finance has also ruled out a return to the international capital market in 2026, reducing immediate concerns about Ghana flooding the market with new dollar debt.
Consequently, the present re-pricing is primarily a valuation and global-liquidity issue, rather than evidence of an imminent Ghanaian default.
By: Toma Imirhe / businesspostonline
