The Bank of Ghana sold GH¢13.71 billion in 14-day central-bank bills at a weighted average interest rate of 10.50% in its latest short-term securities auction, highlighting the significant volume of funds moving through the country’s money market.
Results of Tender 879, held on September 14, show that the central bank sold GH¢13,711.37 million of the two-week instrument, with the weighted average discount rate settling at 10.4578% and the corresponding interest rate at 10.5000%.
The auction was priced within an exceptionally narrow band.
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Discount-rate bids ranged between 10.4577% and 10.4578%, while interest-rate bids submitted ranged from 10.4999% to 10.5000%. Bids within that range were allotted in full, leaving the auction tightly clustered around the 10.50% interest-rate level.
The size of the transaction is particularly notable given the short maturity of the instrument.
A 14-day bill by the Bank of Ghana is fundamentally different from the Treasury bills issued on behalf of the Government of Ghana. Whereas Treasury securities primarily finance government borrowing requirements, Bank of Ghana bills are central-bank instruments used within the domestic money market.
That distinction is important because the GH¢13.71 billion recorded in the latest tender should not be interpreted as new government borrowing.
Rather, the transaction reflects activity within the central bank’s own securities framework and provides another indication of the scale of liquidity being managed through short-dated instruments.
Norvan Reports