Interest Rates Decline in T-bills Auction as Government Secures GH¢3.212bn

Interest rates in T-bills auctions witnessed a slight decline, aligning with the ongoing disinflation process, ahead of the Monetary Policy Committee (MPC) meeting scheduled for this week.

Based on auction results released by the Bank of Ghana, the yield on the 91-day bill dropped by 10.0 basis points to 25.09%. Similarly, the 182-day bill saw a marginal decrease to 26.94% from the previous week’s 26.99%.

The rate on the 364-day bill also experienced a decline of 4.0 basis points to 27.95%.

Despite the slight decrease in interest rates, demand for T-bills softened, with the government securing GH¢3.212 billion from the sale of these short-term instruments, representing a 0.77% oversubscription.

The majority of the funds, amounting to GH¢2.493 billion (77.62%), came from the 91-day bill, with all bids being accepted. Similarly, all bids tendered for the 182-day bill, totaling GH¢636.63 million, were accepted. The one-year bill received GH¢82.19 million in bids, with all being accepted as well.

Databank Research had previously anticipated a downward trend in interest rates, attributing it to falling inflation rates. They noted a positive outlook with a favorable risk premium spread, comparing the April 2024 annual inflation rate with prevailing T-bill yields.