Interest rates on treasury bills have declined to 19% in the government’s recent auction on March 7, 2025.
This significant drop marks the first time in 20 months that interest rates have fallen below 20%.
Recently, demand for short-term instruments has surged, with the government consistently recording subscription rates exceeding 100%.
In this week’s auction, the government secured an oversubscription, receiving bids worth GH¢10.30 billion but accepting GH¢6.221 billion. A total of GH¢4.08 billion in bids was rejected.
According to auction results released by the Bank of Ghana:
• The 91-day bill saw the highest demand, receiving GH¢6.00 billion in bids.
• The 182-day bill received bids worth GH¢2.894 billion, but only GH¢842.61 million was accepted.
• The 364-day bill received bids totaling GH¢1.40 billion, with GH¢947 million accepted.
Interest rates have also declined:
• The 91-day bill rate dropped from 20.79% last week to 17.71%.
• The 182-day bill fell to 18.96%.
• The 364-day bill declined from 22.69% to 19.98%.
The recent surge in demand for short-term instruments signals strong investor confidence. The government’s decision to reject excess bids suggests either a cautious borrowing approach or an effort to avoid high interest rates.
Treasury bills remain the government’s primary source of borrowing as it seeks to regain access to the international capital market.
Source: www.ghanaweb.com
