Per the report, this injected a fresh GH¢3.10billion into state coffers
Government exhibited aggressive borrowing last week, accepting nearly all bids worth GH¢10.09billion – outstripping its auction target by 40.68 percent, according to a Weekly Market Update report by Laurus Africa Securities.
Per the report, this injected a fresh GH¢3.10billion into state coffers, underscoring a deliberate buffer-building strategy amid looming maturities.
This comes at a time when analysts are worried about the nation’s debt management, in order not to slip into unsustainable debt levels even as government preps for IMF exit in May and full service of national debt.
Appetite for Treasury bills dipped slightly toward the end of last year, due to falling interest rates as investors explored alternatives with higher returns.
However, the report maintained that investor appetite remained robust last week, particularly for the 364-day Treasury bill which accounted for about 46 percent of the total uptake.
Consequently, weighted average yield on the tenor edged 8 basis points higher to 12.98 percent – with shorter tenors also witnessing slight increases. The 182-day and 91-day bill yields stood at 12.65 percent and 11.19 percent respectively.
Decentralise agric policies at local level for growth – Chamber of Agribusiness Ghana.
“We anticipate sustained demand in the upcoming auction, driven by system liquidity. However, elevated T-bill maturities continue to pose upside risks to yields,” analysts at Laurus Africa Securities noted.
Trading activity in government securities exploded on the Secondary Bond Market, with volumes surging 165.46 percent week-on-week to GH¢9.34billion.
Interest clustered around the front to middle of the local currency curve, with the February 2027, 2030 and 2031 bonds attracting significant demand.
The average secondary market yield compressed by 21 basis points to 15.13 percent, signalling bullish momentum as investors position themselves for the upcoming coupon payments.
Ghana Stock Exchange (GSE) witnessed a liquidity-fuelled advance on the equities market, albeit with modest index growth.
GSE’s Composite Index inched up 0.04 percent while the Financial Stocks Index posted a stronger 0.39 percent weekly gain – reinforcing investor preference for financials on the back of improving fundamentals.
Traded volume more than doubled and value traded jumped 110 percent. Gainers outnumbered laggards. The NewGLD ETF rallied 10.34 percent after its underlying asset hit a record high. CAL and CLYD also featured among the top gainers, while MTN Ghana was the sole decliner.
The analyst maintained that the cedi continues to face persistent pressure on the Forex (FX) market.
The Ghanaian legal tender extended its depreciatory trend, albeit at a slower pace, losing 1.11 percent against the US dollar last week. Year-to-date, the local currency has weakened by 3.42 percent to trade at 10.82 to the dollar.
The analysts attributed this pressure to rising corporate dollar demand for post-Christmas inventory restocking. The Bank of Ghana’s forex auction, offering US$250million, was only 31 percent covered – highlighting sustained demand.
However, on the commodities side cocoa prices tumbled another 6.59 percent to US$4,993 per tonne – a two-year low. In contrast, gold advanced 2.72 percent to US$4,623.20 per ounce and crude oil gained 1.48 percent to US$64.28 per barrel, supported by record Chinese imports and improving Asian demand signals.
Outlook
With the Treasury seeking to raise GH¢9.83billion in this week’s auction – a 37.43 percent weekly increase – market attention remains fixed on debt dynamics and yield trajectory.
The analyst noted this confluence of strong liquidity, corporate FX demand and mixed commodity fortunes sets the tone for a week of cautious trading across asset classes.
