Trading slows on secondary bond market

…ahead of interest payments

Trading activity on the secondary bond market slowed last week, with total volumes declining by 19.34 percent week-on-week to settle at GHS1.53 billion.

The moderation follows weeks of relatively robust flows and reflects what market watchers describe as cautious repositioning by investors ahead of coupon inflows later this month.

Market data showed that transactions were concentrated in the general category bonds, particularly the August 2027 and February 2030 maturities.

These short- to medium-dated papers attracted significant investor interest due to their relatively attractive yields and manageable risk outlook.

Overall, the 2027 to 2030 maturities accounted for 45 percent of total market turnover, trading at a weighted average yield of 16.56 percent.

On the longer end, the 2031 to 2038 papers dominated with 55 percent of volumes, priced at an average yield of 16.41 percent.

Analysts note that the distribution of flows between medium- and long-dated maturities reflects an ongoing balance in investor appetite, with some participants preferring shorter tenors for liquidity purposes, while others lock into longer-dated bonds for higher carry.

Yields have seen relative calm after months of volatility driven by debt restructuring uncertainties and macroeconomic headwinds. Traders believe that upcoming coupon inflows are likely to inject liquidity into the market, spurring renewed activity and aiding price discovery in the near term.

The easing in volumes also comes against the backdrop of cautious optimism about Ghana’s macroeconomic outlook. The cedi has shown some resilience in recent weeks, while inflation has moderated slightly, providing a more supportive environment for fixed-income securities. However, concerns remain over fiscal consolidation efforts and external financing needs, factors that continue to weigh on investor sentiment.

Looking ahead, analysts expect trading activity to pick up modestly as coupon inflows are absorbed and market participants rebalance their portfolios. The interplay between government issuance, liquidity conditions and macroeconomic data releases will continue to guide yields and turnover levels on the secondary market. For now, investors remain focused on tactical positioning, with most eyeing opportunities in the medium-dated segment of the curve while monitoring fiscal and monetary developments.