Upward trend in T-bill yields to continue; Government to borrow GH¢7.44bn this week

The upward trend in treasury bill yields is expected to continue despite inflation easing for the fifth consecutive months.

The strong demand amid tighter market liquidity is also making it difficult for yields to come down.

The Monetary Policy Committee (MPC) of the Bank of Ghana will meet this week to consider benchmark rate adjustments.

Most analysts expect the policy rate to remain steady notwithstanding the recent decline in inflation.

Despite the Federal Reserve’s recent rate cut and disinflation trend, we expect the MPC to uphold a tight monetary stance in line with the IMF (International Monetary Fund) programme parameters, to control inflation expectations amid election-induced spending while adopting a forward guidance approach to tame cedi depreciation pressures”, Databank Research said.

The 91, 182, and 364-day yields increasing by 9.0 basis points, 2.0 basis points and 1.0 basis points, settling at 25.01%, 26.82%, and 28.08% week-on-week, respectively.

However, the Treasury fell short of its auction target of GH¢5.88 billion, raising only GH¢4.39 billion, resulting in a shortfall of GH¢1.49 billion.

Meanwhile, the Treasury plans to raise GH¢7.44 billion through the issuance of 91- day, 182-day, and 364-day bills this Friday September 27, 2024.

This will cover GH¢2.99 billion in maturing bills.