Strong Demand to Push T-Bill Yields Lower — Laurus Africa
By Nii Trebi Hammond
Sustained investor demand at last week’s Treasury bill auction is likely to exert further downward pressure on yields at the next auction scheduled for March 5, 2026, according to investment advisory firm Laurus Africa Securities Limited.
In its weekly market assessment released on March 2, Laurus Africa said its outlook is informed by exceptionally strong bidding at the most recent auction, where total bids reached GHS14.82 billion, almost three times the government’s issuance target of GHS5.81 billion.
The Treasury accepted GHS8.81 billion, comfortably above the target size and about 54.16 per cent higher than estimated Treasury bill maturities. As a result, the government recorded a net issuance of GHS3.09 billion, bolstering its short-term cash position.
The excess demand translated into sharp declines in yields across all short-term tenors. The 91-day Treasury bill fell by 113 basis points to 5.32 per cent, while the 182-day bill eased by 120 basis points to 6.98 per cent. The 364-day bill also declined by 44 basis points to 9.76 per cent.
Against this backdrop, Laurus Africa expects market conditions at the upcoming auction to remain favourable, noting that the government plans to raise GHS5.68 billion to refinance estimated maturities of GHS5.60 billion. The relatively modest refinancing requirement, coupled with strong investor liquidity, is expected to sustain demand for short-term securities.
The firm further noted that market sentiment could be reinforced by the release of February 2026 inflation data this week, which is widely expected to show a further deceleration in inflation. A softer inflation outcome, it said, would strengthen expectations of lower yields and encourage continued demand at future auctions.
Activity in the secondary market also supported the outlook. Trading volumes increased by 17.04 per cent week-on-week to GHS9.31 billion, driven largely by heightened activity in newly issued bonds and Treasury bills.
Consequently, the weighted average yield on the secondary market declined to 11.85 per cent from 12.07 per cent the previous week, signalling strong buying interest, particularly in new bond issues.
Laurus Africa said these developments collectively point to a continuation of the downward yield trend in the near term, provided macroeconomic conditions remain supportive.
