The government finally sold a little above the target for its Treasury bills auctioning, following months of under-subscriptions.
After Friday, June 3, 2022, auctioning, the government secured ¢1.395 billion from the sale of the 91-day and 182-day Treasury bills, nearly 14% oversubscription.
However, this came at a higher cost in order to achieve the target of ¢1.228 billion
But it was a necessary evil in order to attract the local investors and large commercial banks.
According to the auctioning results, the 3-months bill was the financial instrument highly patronised, but at an interest cost of 22.57%.
¢1.22 billion was mobilised from the sale of the short term instrument.
On the other hand, ¢172.9 million was secured from the 182-day T-bills, but at an interest rate of 24.41%.
Currency Analyst, Courage Martey told Joy Business he’s unsure whether there will be regular oversubscription of T-bills sales going forward.
“I don’t see much room to increase liquidity on the market in the near term because for as long as inflation continues to go up, the Central Bank cannot release liquidity on the market. This is because further liquidity on the market will only push inflation further up”.
“Because the Central Bank’s core mandate is to maintain price stability that means that in the interim we will have to prioritise the quest to restore low inflation. And to achieve that it requires keeping a firm grip on money supply”, he stressed.
Securities Bids Tendered (GH¢) Bids Accepted (GH¢) Interest rate
91 Day Bill 1.222 billion 22.574%
182 Day Bill 172.96 million 24.410%
Total 1.395 billion
Target 1.228 billion