Bond Market Turnover drops 62.9% amid Investor Caution
By Praisebell Rosemond Larbi
Ghana’s secondary bond market activity slumped sharply last week, with total turnover declining by 62.90 percent week-on-week to GH¢571.42 million, down from GH¢1.54 billion recorded in the previous week. The decline reflects a cautious investor sentiment ahead of key macroeconomic updates and fiscal policy signals.
According to Databank Research, trading activity was largely concentrated in the February 2030 bond, which led market flows with GH¢109.24 million in traded volumes. This indicates that medium-term maturities remain the most liquid segment of the bond curve despite the broader market slowdown.
The 2027–2030 maturities continued to anchor the market, capturing 51 percent of total turnover at a weighted average yield of 15.46 percent. Meanwhile, bonds maturing between 2031 and 2038 attracted moderate investor interest, contributing 29 percent of total volumes traded at an average yield of 15.98 percent.
Market analysts say the significant contraction in turnover is partly due to tight liquidity conditions in the financial system, as banks and institutional investors adopt a wait-and-see approach ahead of upcoming macroeconomic indicators. The release of the October 2025 inflation data and the anticipated 2026 Budget presentation are expected to guide portfolio adjustments in the coming weeks.
Databank Research noted that investor sentiment in the fixed-income market has turned more conservative in recent sessions, following months of steady activity. “We anticipate subdued market activity in the near term, as investors adopt a cautious stance amid tight liquidity conditions while awaiting the upcoming inflation release and fiscal direction from the 2026 Budget presentation,” the report said.
The slowdown also comes amid expectations of possible yield adjustments, given Ghana’s improving macroeconomic environment, declining inflation, and strengthening cedi. These factors may influence the yield curve in the coming months, as investors reassess duration risks and potential returns in a disinflationary setting.
Despite the current lull, market watchers believe the medium- to long-term outlook for Ghana’s bond market remains stable. Continued disinflation, fiscal discipline, and improved investor confidence could drive renewed demand for government securities as yields align with the evolving macroeconomic fundamentals.
Analysts say that sustained policy clarity from the government, coupled with stable monetary conditions, will be key to reviving momentum and restoring deeper liquidity in the secondary bond market heading into 2026.
