Government exceeds T-bills target by 51% as borrowing costs continue to fall

The government recorded another oversubscription of its treasury bills at the latest auction, as investors offered nearly GH¢10 billion despite declining interest rates on short-term securities .

According to auction results from the Bank of Ghana, the government exceeded its target by 51.6 percent, with bids totalling GH¢9.937 billion against a target of GH¢6.554 billion. The government accepted GH¢8.381 billion of the bids .

91-day bill leads for the first time in months

For the first time in several months, the 91-day Treasury bill attracted the most interest, receiving GH¢6.225 billion in bids—representing 62.6 percent of total bids. The government accepted GH¢5.835 billion of that amount .

The 182-day bill received GH¢1.915 billion in bids, with GH¢1.593 billion accepted, while investors offered GH¢1.796 billion for the 364-day bill. The government accepted GH¢952.77 million of the bids for the longest-dated instrument .

Interest rates continue downward trend

Interest rates on government securities continued their downward trajectory, with the yield on the 91-day bill declining by 14 basis points to 4.80 percent. The 182-day bill rate dropped from 6.87 percent to 6.67 percent, while the 364-day bill recorded the sharpest decline, falling by 66 basis points to 10.11 percent .

The sustained decline in Treasury bill rates reflects improving macroeconomic stability and renewed investor confidence following Ghana’s debt restructuring and ongoing IMF programme . Finance Minister Dr Cassiel Ato Forson previously noted that the 91-day Treasury bill rate had dropped significantly from 28.5 percent in January 2025 to 5.73 percent by June 2026 .

Strategic shift from short-term borrowing

The strong demand for short-term instruments comes as the government prepares to reduce its reliance on Treasury bills by returning to medium- and long-term domestic bond issuance. Restrictions imposed under the Domestic Debt Exchange Programme (DDEP) expired in March 2026, clearing the way for the Ministry of Finance to resume longer-term borrowing .

Under the 2026–2029 Medium-Term Debt Management Strategy, the government plans to issue GH¢17 billion in domestic bonds this year and another GH¢19 billion in 2027, with part of the financing expected to support the build-up of resources for upcoming debt maturities .

The government faces approximately GH¢111.4 billion in domestic principal and interest payments in 2027 and 2028, making the transition to longer-dated instruments a priority to manage rollover risks .

Strong investor confidence amid falling yields

The latest auction results demonstrate that investors remain willing to lend to the government even as returns continue to decline . The lower borrowing costs signal reduced pressure on domestic financing and reflect easing economic conditions following periods of elevated interest rates driven by economic uncertainty .

The Bank of Ghana’s July 2026 Monetary Policy Report noted that short-term bills had been the major source of financing for government operations, driven by strong investor appetite for 364-day T-bills and the expiration of restrictions that had prevented new domestic bond issuance .

SECURITIES BIDS TENDERED (GH¢) BIDS ACCEPTED (GH¢)
91 Day Bill 6.225bn 5.835bn
182 Day Bill 1.915bn 1.593bn
364 Day Bill 1.796bn 952.77m
Total 9.937bn 8.381bn
Target 6.554bn