The Bank of Ghana (BoG) has cut the interest rate on the 56-day bill by a significant margin.
The auction results released on July 21, 2025, showed that the Central Bank offered 11.9 -13.0 % to the investors.
This is despite investors requesting rates of 11.7-24.0% for the 56-day bill.
In its auction results on July 7, 2025, the Central Bank offered 26.5% to investors that participated in the offer.
Since the Central Bank resumed the issuance of its short-term bills on April 30, 2025, the yields have been around 26 to 27%.
Impact
The rate quoted by Bank of Ghana for its short-term bills has been influenced by the policy rate, which is currently around 28%.
This has resulted in some market analysts arguing that if the Bank of Ghana is dropping yield on the short-term bills, then the next move by the regulator could signal a cut in the policy rate by some significant margin.
Others have also told Joy Business that the Bank of Ghana may be trying to explore the market and see how investors will respond to a lower rate on its bills.
Databank Research, in its recent market analysis, argued that the limited amount offered during Bank of Ghana’s short-term auction was aimed at pushing investors to participate in the Government of Ghana treasury bills.
Background
The Bank of Ghana earlier this year resumed the issuance of its short-term bills as part of efforts to mop up excess liquidity and control inflation. The Central Bank, since January 2018, has been conducting weekly open market operations by auctioning Bank of Ghana securities, with the issuance of the 14-day and 56-day bills every week.
The 14-day instrument is issued at the policy rate, while the 56-day instrument is issued at a competitive market rate, allowing banks to quote their prices.
The objective of the 56-day Open Market Operations (OMO) instrument is to extend the maturity profile of the instrument and mop up excess liquidity.
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