Ghana’s government fell nearly 30 percent short of its Treasury bill (T-bill) target at the latest auction, as investors pulled back sharply on longer-dated instruments, raising fresh questions about the sustainability of the country’s near-term borrowing strategy.
Results of Tender 2002, released by the Bank of Ghana (BoG), show total bids received amounted to GH¢5.3 billion against a target of GH¢7.57 billion, a shortfall of approximately GH¢2.45 billion. Of the amount tendered, GH¢5.11 billion was accepted.
Investor preference remained heavily concentrated at the short end of the market. The 91-day bill drew GH¢4.44 billion in bids, with GH¢4.43 billion accepted, while the 182-day bill recorded full uptake, with GH¢521.96 million both tendered and accepted.
Demand weakened considerably for longer maturities. Of the GH¢348.94 million tendered for the 364-day bill, only GH¢162.59 million was accepted, underscoring the government’s caution in locking in higher borrowing costs amid rising yields. The rejection of nearly half the 364-day bids signals that both the government and investors are wary of committing to longer-term rates at current levels.
Borrowing costs rose across all three instruments. The 91-day bill climbed 10 basis points to 4.91 percent, the 182-day bill rose 6 basis points to 6.77 percent, while the 364-day bill reached 9.97 percent.
Compared to the previous tender held on April 2, 2026, where the government raised GH¢2.95 billion from GH¢3.17 billion in bids, the latest results represent a significant ramp-up in borrowing ambition that was not matched by investor appetite. The sharp increase in the target appears to have stretched beyond what the domestic market could absorb in a single auction cycle.
The outcome continues a pattern of undersubscription that has persisted in recent weeks. Market analysts interpret persistent undersubscription as a signal that investors are growing increasingly selective, demanding higher compensation for holding government paper, particularly at extended maturities, pointing to a widening disconnect between fiscal financing ambitions and prevailing market realities.
Looking ahead, the government has set a lower target of GH¢4.89 billion for Tender 2003, suggesting a recalibration in response to prevailing market conditions. The pullback in target size indicates that authorities are adjusting expectations rather than risking another high-profile shortfall.
For the government, weaker auction demand could narrow its options, potentially forcing higher rate concessions or a greater reliance on alternative financing. For investors, the environment continues to favour short-duration positioning, while the 364-day bill offers elevated returns for those willing to accept the associated risk.
