The government borrowed GH¢24.0bn via treasury bills in February 2024, 29.3% higher than its target.

This follows strong investor appetite and softening yield quotes.

Investors submitted total bids worth GH¢24.1 billion (+8.8% month-on-month) while accepted bids were valued at GH¢24.0 billion (+8.9% mon-on-month), sustaining the government’s quest to build buffer for future auction shortfall as indicated in the 2024 budget.

The government exceeded its 2-month target cumulatively by GH¢12.4 billion. This puts it on course to meet its 2024 target buffer of GH¢31.8 billion.

Analysts estimate show that the cumulative excess uptake in the first 2 months of 2024 is 23% more than the excess uptake recorded in the same period in 2023.

Yields fell sharply

Yields fell sharply in February 2024 as the strong money market liquidity outweighed any upside risk from the unexpected uptick in the January 2024 inflation.

The 91-day yield eased by 131 basis points month-on-month to 27.3%, while the 182-day went down by 135 basis points to 29.8%. The 364-day yield also fell by 150 basis points to 30.3%.

Analysts observed the tenor premium between the 91-day and the 182-day at 247 basis points, with that between the 182-day and 364-day bills at 55 basis points.

This suggests that the 182-day is more attractive albeit with reinvestment risk than the 364-day bill.