Ghana’s financial markets delivered a mixed performance over the latest review period, with tightening liquidity in the primary debt market running alongside stronger secondary market activity, modest currency weakness, and resilient equities.
Treasury bill auction reflects demand shortfall
Investor appetite for Treasury bills declined sharply in the most recent auction on the Ghana Fixed Income Market (GFIM), with total bids falling to GH¢3,168.56 million from GH¢3,938.59 million recorded the previous week. Against a government target of GH¢4,673.00 million, the outcome represents a 32.19 percent undersubscription, marking the third consecutive week that the government has fallen short of its domestic borrowing target.
The acceptance pattern across instruments showed that 98.68 percent of bids for the 91-day Treasury bill were taken up, all bids for the 182-day bill were accepted, while 82.25 percent of bids for the 364-day bill were absorbed. The concentration of demand at the short end reflects investor caution in the current environment, with participants favouring liquid, short-dated instruments over longer commitments.
Interest rates edged higher across all tenors. The 91-day bill rate rose by one basis point to 4.82 percent, the 182-day bill climbed nine basis points to 6.71 percent, and the 364-day bill increased seven basis points to 9.84 percent, signalling that the market is beginning to price in tighter conditions.
Looking ahead, the government has set a significantly higher borrowing target of GH¢7,570.00 million for its next auction, a level that will test market depth and investor confidence given recent undersubscription trends.
Secondary market records stronger volumes
While the primary market showed demand strain, the secondary market told a different story. Trading volumes on the GFIM rose 7.8 percent week-on-week to GH¢7.72 billion, suggesting that investors are actively managing portfolios and repositioning within existing instruments even as demand for fresh issuance softens.
Treasury bills accounted for the largest share of secondary market activity at 47.10 percent of total volume, reaffirming their role as the most liquid instruments in the market. New Government of Ghana notes followed with a 32.25 percent share, reflecting sustained interest in restructured debt instruments following the Domestic Debt Exchange Programme (DDEP). Sell-buy-back transactions made up 18.88 percent, indicating active short-term liquidity management by financial institutions. Corporate bonds remained marginal at just 1.76 percent of total activity, underscoring the relatively underdeveloped state of Ghana’s corporate debt market.
Cedi records mixed currency moves
The Ghana cedi posted mixed performance against major trading currencies over the review period. It depreciated 0.27 percent against the US dollar, closing at GH¢11.97, bringing its year-to-date decline against the dollar to 5.00 percent.
Against the British pound, the cedi edged 0.13 percent higher to GH¢14.56, although its year-to-date position against sterling remains negative at 3.46 percent. The local currency weakened further against the euro, falling 0.47 percent to close at GH¢12.70, with a year-to-date depreciation of 3.35 percent.
In the open market, the cedi traded at midrates of GH¢11.25 to the dollar, GH¢15.00 to the pound, and GH¢13.03 to the euro, reflecting the wider spreads typical of retail foreign exchange channels.
Stock market holds the week’s gains
The Ghana Stock Exchange (GSE) closed the period on a positive note, with the GSE Composite Index (GSE-CI) settling at 13,040.78 points. The index’s year-to-date gain stands at 0.49 percent, a modest positive return against a backdrop of considerable global uncertainty. Key contributors to recent trading activity include Scancom PLC (MTN Ghana), Clydestone Ghana, and Cocoa Processing Company, which have featured among the most active counters in recent sessions. Market capitalisation stood at GH¢243.85 billion at the close of the latest session.
The relatively firm equity market performance suggests that investors are continuing to allocate capital toward listed companies, particularly as declining Treasury bill yields in recent months have reduced the attractiveness of short-term government instruments as an alternative to equities.
What the numbers indicate
Taken together, the week’s data points to a financial system in a phase of transition. Tighter liquidity in the primary debt market is pushing yields modestly higher, but secondary market activity remains healthy, indicating that capital is still circulating within the system. The cedi’s marginal movements against major currencies suggest that macroeconomic stabilisation is providing some buffer, even as external pressures from global oil prices and the Middle East conflict continue to weigh on import costs and the broader external account.
The government’s substantially larger borrowing target at the next auction will be a critical signal of whether market appetite can recover or whether yields will need to rise further to attract sufficient demand.
