Ghanaian yields have continued to march towards a low-interest regime following a 100bps policy rate cut to 22.5% in the last MPC meeting.
The yield on the 91-day bill softened by 48bps to a 5-year low of 11.91% this week versus 12.39% last week while that of the 182-day also dropped by 48bps to a 5-year low of 13.29% this week versus 13.77% last week.
A 3-year bond was also auctioned by the government and its yield fell by 300bps to a 4-year low of 18.50%. However, there was strong demand for treasury securities especially the 91-day T-bill.
Treasury yields doesn’t just influence how much government pays to borrow from the money market, it also impacts the confidence and returns earned to investors who buy into this debt.
The lower treasury yields for the short-term fixed income securities signifies the government need for longer term debt in line with the policies set for economic growth.
This could force growth oriented investors to look into alternative investment instruments such as stocks and bonds, where they can earn higher returns.
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