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T-bills auction: Government misses target by 20%

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Government Treasury bill sale fell short of its target by about 20%, as uncertainty over the Domestic Debt Exchange (DDE) programme continues.

According to the auction results, government mobilised ¢1.930 billion, as against a target of ¢2.415 billion.

The undersubscription of the Treasury bills is in sharp contrast to the 52% percent oversubscription recorded the previous week.

The 91-day Treasury bill was the highly patronised by the investors as ¢1.58 billion was secured from the sale of the short term instrument.

Despite the maturity period being shorter than the 182-day and 364 day treasury bills, the interest rates of the three financial instruments were virtually unchanged at 35%.

The yield on the 91-day T-bill was 35.63%. That of the 182-day bill was 35.80%, compared to 35.83% the previous week, whilst the 364-day bill was estimated at 35.55%

Finance Minister, Ken Ofori-Atta, last week in an exclusive interview with Joy Business said it will be suicidal if Treasury bills is included in the debt exchange programme because it is currently the only source of borrowing for government.

“We can’t afford to touch it. Let me assure you, Treasury bills will forever remain sacrosanct. Treasury bills are exempted completely. We have done the sustainability analysis. We are not including treasury bills. That is how government funds its operations”, he reaffirmed.

Despite his pronouncement, the sale of the short term securities have been mixed in recent times.

Securities Bid Tendered (GH¢) Bids Accepted (GH¢)
91 Day Bill            1.581 billion 1.581 billion
182 Day Bill 292.43 million 292.43 million
364 Day Bill 56.82 million 56.82 million
Total 1.930 billion 1.930 billion
Target 2.415 billion  

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