Ghana’s fixed income market recorded substantial trading activity on Monday with treasury bills commanding the lion’s share of transactions as investors continued their preference for short-term government debt over longer-dated securities and corporate bonds.
The Ghana Fixed Income Market (GFIM) processed trades across multiple security categories, with 364-day treasury bills showing the most extensive activity featuring 51 different instruments trading in a price range of 88 to 99. The shorter tenor 91-day and 182-day bills also attracted significant volume, with prices ranging from 93 to above 99 for the former and 92 to 100 for the latter.
New Government of Ghana (GoG) bonds from the 2023 series recorded noteworthy trading volumes, led by the 2023-GC-2 instrument which saw 42.66 million in nominal value change hands. The 2023-GC-6 bond attracted 35 million while 2023-GC-3 traded 20 million, all carrying yields in the 15 to 16 percent range with maturities extending from 2027 through 2038.
The trading patterns mirror what’s become a consistent theme in Ghana’s debt markets throughout 2025: heavy institutional appetite for government securities, particularly at the short end of the yield curve, while corporate bonds and repo transactions remain largely dormant.
Treasury bills have emerged as the favored instrument for investors navigating Ghana’s improving but still uncertain macroeconomic environment. Recent auctions have seen yields compress significantly, with the 91-day falling to 10.45 percent, the 182-day to 12.36 percent, and the 364-day to 12.88 percent, reflecting both strong liquidity in the banking system and growing confidence in the government’s debt management.
Those yield levels represent dramatic declines from the crisis period of 2023 when treasury bill rates exceeded 30 percent as Ghana grappled with debt sustainability concerns and high inflation. The normalization reflects progress under the country’s International Monetary Fund (IMF) program and improved fiscal discipline.
However, investor appetite showed signs of softening in last week’s primary auction, where the government accepted GH¢2.57 billion against a target of GH¢3.71 billion, falling short by about 30.5 percent. That shortfall suggests investors may be becoming more selective as yields compress toward levels that don’t adequately compensate for remaining risks.
The secondary market trading captured in Monday’s report shows a different dynamic. Unlike primary auctions where the government sets acceptance levels, secondary trading reflects investors adjusting positions, taking profits, or repositioning ahead of upcoming maturities. The heavy volume in 364-day bills particularly suggests institutional players managing liquidity and return objectives across the yield curve.
Corporate bonds remained largely illiquid despite multiple issuers listed on the GFIM platform. Instruments from Letshego Ghana, Bayport Savings and Loans, Ghana Cocoa Board, Izwe Savings and Loans, Kasapreko, and Quantum all appeared in the trading report but with minimal to no activity.
This persistent corporate bond illiquidity represents a significant constraint on Ghana’s capital markets development. Companies seeking to raise debt capital struggle to attract investors when secondary market trading is thin, creating a vicious cycle where illiquidity begets more illiquidity.
The Ghana Cocoa Board bonds, despite being sovereign-backed given the entity’s importance to Ghana’s export earnings and government support, haven’t escaped the broader corporate market malaise. Even instruments with implicit state guarantees can’t generate sustained trading interest when investors overwhelmingly prefer direct government paper.
Bank of Ghana (BoG) bills, which the central bank uses for monetary policy operations, also featured in Monday’s trading with both 56-day and 273-day tenors available. These instruments serve as important tools for managing banking system liquidity and implementing the BoG’s policy rate transmission mechanism.
The sell and buy-back trades section of the report, which captures repurchase agreements on government bonds, showed limited activity. Repos typically develop in mature fixed income markets as institutions use them for short-term funding and liquidity management. Ghana’s underdeveloped repo market constrains financial institutions’ ability to efficiently manage balance sheets.
What Monday’s trading data reveals is a market that’s functional for government debt, particularly treasury bills, but hasn’t evolved into the diversified fixed income ecosystem that Ghana’s economy needs. Companies can’t efficiently raise debt capital, institutional investors lack variety in fixed income options, and market depth remains concentrated in the shortest maturities.
The government bond yield environment of 15 to 16 percent still reflects significant risk premiums despite Ghana’s improving fundamentals. While inflation has declined to 11.5 percent as of August 2025, marking its lowest level in four years, bond yields haven’t compressed proportionally, suggesting investors remain cautious about Ghana’s medium-term fiscal trajectory.
For investors, the current market offers relatively attractive real returns on treasury bills given falling inflation. A 364-day bill yielding nearly 13 percent provides positive real returns when inflation runs at 11.5 percent, though the margin has narrowed considerably from earlier periods when nominal yields were twice current levels.
The concentration of trading in treasury bills also reflects institutional realities. Banks, the dominant players in Ghana’s fixed income market, must manage short-term deposit liabilities and prefer matching those with short-term assets like treasury bills. Pension funds and insurance companies, which elsewhere provide natural demand for longer-dated bonds, remain smaller players in Ghana’s market.
The government faces a delicate balancing act. It needs to continue borrowing to fund operations and refinance maturing debt, but must do so at sustainable rates that don’t crowd out private sector borrowing or signal renewed fiscal stress. The shortfall in last week’s auction suggests this balance is becoming trickier as yields fall.
For the broader fixed income market development, Monday’s trading patterns underscore challenges that persist despite Ghana’s improving macroeconomic conditions. Government securities dominate, corporate bonds languish, and market infrastructure like repos remains underdeveloped. Those structural issues require regulatory reforms, institutional development, and sustained macroeconomic stability that encourages longer-term investment planning.
The GFIM platform itself, which operates on Bloomberg’s E-Bond trading and surveillance system, provides the technical infrastructure for a modern fixed income market. What’s missing isn’t technology but the underlying conditions that generate diverse participation, sustained liquidity, and investor confidence across the full spectrum of fixed income instruments.
Until Ghana can demonstrate that corporate issuers represent viable investment alternatives to government paper, and until the macroeconomic environment stabilizes sufficiently that investors commit capital beyond 364 days with confidence, the market will likely continue exhibiting the patterns visible in Monday’s report: heavy treasury bill trading, modest government bond activity, and corporate bonds serving primarily as placeholders in portfolio statements rather than actively traded securities.