Ghana's T-bill auction oversubscribed by 60% but investors demand steeper rates nearing 13%

Ghana's government has recorded a significant oversubscription in its latest treasury bills auction, drawing bids worth GH¢7.37 billion against a target of GH¢4.602 billion — roughly 60% above what was sought. However, the strong demand came at a price, as investors pushed for higher returns, sending interest rates to levels not seen since January 2026.

Of the total bids received, the government accepted GH¢6.01 billion. The 364-day bill dominated activity, accounting for approximately 73% of all bids tendered. Some GH¢5.43 billion was submitted for the longer-dated instrument, of which GH¢4.28 billion was taken up by the government.

The shorter-dated instruments also attracted healthy interest. The 91-day bill drew bids of GH¢1.47 billion, with GH¢1.34 billion accepted, while the 182-day bill saw GH¢461.91 million tendered and GH¢378.80 million accepted.

Interest Rates Rise Sharply

Yields climbed across all three instruments, reflecting the higher compensation investors are demanding to hold government paper. The 91-day bill yield rose by 74 basis points to 5.73%, while the 182-day bill moved up from 7.04% to 7.69%. The sharpest move came from the 364-day bill, whose yield surged by 237 basis points to reach 12.82% — pushing the benchmark rate close to 13% for the first time since January 2026.

The spike in yields suggests that while appetite for government securities remains robust, market participants are pricing in greater risk or expecting tighter liquidity conditions ahead. Analysts are likely to watch closely whether the government continues to accept bids at these elevated rates in subsequent auctions, given the implications for the country's domestic borrowing costs.