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Monday, November 28, 2022

Government bags ¢8.11bn from T-Bills in September 2022

Demand for Treasury bills continued to gain traction as government raked in ¢8.11 billion out of total bids of ¢8.20 billion in the month of September 2022.

Government thus exceeded its T-bill issuance target of ¢7.36 billion for the month with a target.

The 91-day, 182-day, and 364-day tenors cleared at 30.45% (+184 basis points, 31.57% (+163 basis points), and 31.55% (+202 basis points) as yields continued their uptrend throughout September 2022.

Last week, the Treasury raised GH¢999.86 million in the T-bill auction, accepting all bids.

The uptake exceeded the auction target of ¢905.00 million by 10.48%.

The yields on T-bills continued their northward trek, with the 91-day bill clearing at 30.45% and the 182-day bill going for 31.57%.

The weighted average yield of the 364-day bill was however 31.55%.

This week, the Treasury is seeking to raise ¢1.176 billion across the 91-day to 182-day bills.

The expected amount raised will be used to refinance maturities worth G¢1.092 billion.

Trading activity on bond market shoots up to ¢3.32bn

On the bond market (secondary market), trading activity shot up to ¢3.32 billion (+128.5%), with sell-side activity dominating trades.

The yield curve widened by an average of 101 basis points as a result.

Most trades occurred at the front to the belly of the yield curve, with 2022-2025 maturities accounting for 48.6% of total face traded while 49.7% of trades occurred along the 2026-2029 maturities.

“In the primary market, we expect investors to maintain interest in T-bills for frequently re-pricing benefits, as we do not expect a bond offer this week. Investors in the secondary market are likely to focus on trading at the front to the belly of the yield curve”, Databank Research said.

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