Kofi Ahovi

  The government failed to meet its treasury bills target just a week after achieving an oversubscription, as demand moderated.   According to auction results by the Bank of Ghana, the short-term instruments were undersubscribed by about 20%. The government received GH¢4.20 billion bids from the investors. This was against a target of GH¢5.27 billion. It, however, accepted all the bids tendered. The 91-day bill was once again the most subscribed, as GH¢2.25 billion of the bids were tendered, representing 53.6% of the total bids. The 182-day bill recorded bids worth GH¢802.87. For the 364-day bill, GH¢1.146 billion was tendered. Meanwhile, interest rates continue to rise on the yield curve. The yield on the 91-day bill increased by 26.0 basis points to 5.30%. That of the 182-day bill also went up to 7.13% from 7.08%. Similarly, the yield on the 364-day increased by 39.0 basis points to 11.36%. SECURITIES BIDS TENDERED ( GH¢) BIDS ACCEPTED  ( GH¢) 91 Day Bill ...

 After enduring one of the most severe economic crises in a generation, Ghanaian businesses are finally experiencing a resurgence. The most significant sign of this turnaround are interest rates. The Bank of Ghana has trimmed its benchmark Monetary Policy Rate (MPR), which stood at a punishing 30% at the close of 2023, in consecutive reductions through 2025 to reach 14.0% by March of this year. Inflation, meanwhile, has plunged to 3.30% well below the central bank's target band and the cedi has appreciated over 40% against the US dollar from 2025 to date. This confluence of improved macroeconomic fundamentals is a structural opening for industry, manufacturing, and enterprise to flourish. KEY INDICATORS AT A GLANCE ↓  14.0%                       3.30%  ↓                    ...

  The European Central Bank (ECB) has cut interest rates for the sixth time in nine months as it seeks to bolster eurozone economic growth. The bank stuck to its plan to lower rates in the face of economic challenges, including threats of US tariffs and plans to boost European military spending. The ECB cut its main interest rate to 2.5% from 2.75%, and once again reduced its forecasts for economic growth in the eurozone. The latest cut came as a sell-off of German government bonds spread to other bond markets, including the UK. The sell-off came after Germany's move this week to  increase military and infrastructure spending . Political parties in talks to form a new government plan to pay for this by loosening Germany's fiscal rules, raising the prospect of a big increase in debt. In response, longer term German bonds saw their biggest sell-off in years on Wednesday. This pushed borrowing costs - as measured by the yields on the Germany's 10-year bonds - up by biggest dai...

  A former president of the Ghana Association of Banks, Alhassan Andani, has described the falling spree of interest rates as welcoming, saying it will help boost private sector growth. This comes after the rates rates fell once again as government Treasury bills were oversubscribed by about 40.3% to the tune of ¢3.89 billion. Speaking to Joy Business at the Maxwell Investment Group Business Forum, Mr.  Andani said this is key to support the private sector through scaling back lending rates to aid businesses access credit from banks. This means improvement because it will reduce the aggregate lending rates. For me, the interest rate coming down is just a natural thing and this is welcoming”. “The usual rate of 35% was a problem and I think the downward trend is very good”, he added. Speaking at the event, Chief Executive Officer for the Maxwell Investment Group, Maxwell Ampofo entreated young people to explore various opportunities in their quest to start their businesses. As ...

 Interest rates fell once again as government Treasury bills was oversubscribed by about 40.3% to the tune of ¢3.89 billion. According to the auctioning results by the Bank of Ghana, demand for the 91-day T-bill was very high, pushing the yield down. Following the successful completion of the Domestic Debt Exchange Programme, interest rates on the money market have witnessed a significant fall. From a high of 35%, the rates have eased to about 20% on the average. The yield on the 91-day bill fell by 0.52% to 18.52%. At the same time, the 182-day rate also declined to 21.27%, from 22.84% the previous week. Meanwhile, government accepted ¢3.87 billion of the total bids submitted. Chunk of the bids, however, came from the 91-day T-bill as ¢2.90 billion was accepted. For the 182-day bill, the bids submitted were estimated at ¢983.7 million. But ¢972.4 million was accepted. Securities    Bids Tendered (GH¢) Bids Accepted (GH¢) 91-day 2.912 billion 2.906 billion 182-day 983.77 ...

  The Monetary Policy Committee of the Bank of Ghana has increased its policy rate by 100 basis points from 27 per cent to 28 per cent. This forms part of measures by the central bank to address current inflationary pressures. Inflation for December 2022 hit a 22 year high of 54.1 per cent. The policy rate is of keen interest to businesses, signals the rate at which the Central Bank will lend to commercial banks. It also subsequently influences average lending rates on loans to individuals and businesses.

Interest rates on government securities shot up to 34% last Friday, October 28, 2022, but government failed to achieve its target in the latest Treasury bills auction. This may be due to investor concern about the probability of a debt restructuring by government before a programme can be secured from the International Monetary Fund (IMF). Despite the rising yield on the treasury market, investors are mindful of the current economic situation in the country. The IMF and the World Bank are yet to outdoor the nation’s debt situation, whether it is sustainable or not, but there are analyses that the government would restructure its debt. Already some investors are adopting the wait-and-see attitude before acquiring government securities and making commitments to other collective investment instruments. According to data from the Bank of Ghana, the interest rate on the 182-day T-bill hit 34.2%, from 33.07% the previous week. That of the 91-day bill also surged by 0.55% to 32.70%. The one-y...