Investor Demand Surges in Treasury Bills Auction, Raising GH₵8.2 Billion

Investor demand for treasury bills surged during the most recent auction, with the government successfully raising GH₵8.2 billion, significantly surpassing its GH₵6.8 billion target. This 19.75% over-subscription rate indicates strong investor confidence in short-term government securities. All bids for the 91-day, 182-day, and 364-day treasury bills were fully accepted, reflecting robust demand across all tenors. Yields increased for all categories:

– 91-day treasury bill: Increased by 17 basis points, reaching 27.77%.

– 182-day treasury bill:Increased by 18 basis points, closing at 28.49%.

– 364-day treasury bill: Increased by 4 basis points, settling at 29.94%.

Increased Activity in Fixed Income Market

The week saw heightened activity in the fixed-income market, with trading volumes on the Ghana Fixed Income Market (GFIM) appreciating by 33.5% to reach GH₵5.5 billion. Treasury bills dominated the market, accounting for 62.76% of total trading volumes. Other contributors included:

– Sell-buy-back trades:12.59% of volumes.

– New Government of Ghana notes and bonds:

29.4%.

– Corporate bonds: 0.36%.

Cedi Strengthens Against Major Currencies

The Ghanaian cedi posted gains against major international currencies during the week, closing at mid-rates of:

– GH₵14.74 per US dollar (appreciation of 0.88%).

– GH₵18.61 per British pound (appreciation of 1.87%).

– GH₵14.47 per euro  (appreciation of 1.56%).

Equity Market Performance

On the Ghana Stock Exchange (GSE), the Composite Index declined slightly by 0.10%, driven by losses in the share prices of New Gold (down 0.79%) and MTN Ghana (down 0.83%). The index closed at 4,733.62 points, reflecting a year-to-date return of 51.22%. Despite the overall decline, gains were recorded in key stocks, including:

– Ghana Breweries: Closed at 5.10 cedis.

– SIC: Closed at 27 pesewas per share.

– Unilever Ghana: Closed at 17.99 cedis per share.

– GCB Bank: Closed at 6.35 cedis per share.

– Total Ghana: Closed at 12.92 cedis per share.

Market activity, however, saw a decline, with volumes traded dropping by 69.49% to 5,038,066 shares, valued at 36.25 million cedis.

Investor interest in treasury bills remains robust, driven by attractive yields and rising confidence in the government’s short-term debt instruments. Meanwhile, the equity market is expected to see pivotal contributions from the financial and ICT sectors in the coming week.