The results for the weekly auction of government Treasury Bills held on October 2022, showed that despite the increasing rate on the securities, it was undersubscribed.
The interest shot up to as high as 34% for the 182-day T-bills, 32% for the 91-day bill, and 33% for the 364-day T-bills.
Out of a target of GH¢1,124 million, the Central Bank accepted GH¢701 million bids.
This represents a 37% fall from the expected subscription.
The government was seeking to meet the target in the bid to refinance maturities. The under-subscription will mean that government has to raise revenue to be able to pay maturities in the coming months.
However, with the increase in interest rates on the market, the rate is still lower than the inflation rate of 37.2% according to the Ghana Statistical Service.
Although unclear what may account for the under-subscription of the T-bills it is obvious that investors may be losing confidence in the financial instrument as there appears to be some instability in the market.
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Source: www.ghanaweb.com
