Treasury bill auction records 4% oversubscription in late October

The Treasury bill auction for the final week of October recorded a 4% oversubscription, securing GH₵2.55 billion in bids against a target of GH₵2.45 billion. Despite exceeding the target, the total value of bids tendered represented a significant 40% decline compared to the previous week's performance, signaling a cooling of investor demand toward the end of the month.

The government opted for a selective acceptance strategy, taking in GH₵1.92 billion, which covers approximately 78% of the weekly auction target. The 91-day bill remained the most sought-after instrument, attracting GH₵1.51 billion in bids, of which the Treasury accepted GH₵1.23 billion. Interest in longer-term instruments was more modest; the 182-day bill received GH₵423.74 million in bids with GH₵395.74 million accepted, while the 364-day bill saw GH₵613.83 million in bids with GH₵292.12 million accepted.

Throughout the month of October, the Treasury's cumulative bids reached GH₵19.97 billion, comfortably surpassing the month's overall target of GH₵16.27 billion. However, as part of an effort to manage borrowing costs and keep yields lower, the Treasury rejected roughly GH₵5 billion in offers over the course of the month. This strategy has successfully pushed yields downward across all tenors. Specifically, the yield for the 91-day bill decreased slightly to 4.60%, while the 182-day and 364-day bills fell to 6.26% and 9.60%, respectively.

Looking ahead, the government has set a target of GH₵3.54 billion for the next auction of new issues. The Treasury's continued focus on yield containment suggests that future acceptances will remain disciplined, even as the government seeks to raise higher volumes of capital in the coming weeks to meet fiscal requirements. This approach balances the need for liquidity with the objective of maintaining manageable interest rates on domestic debt.