No Need for Panic Over T-Bill Undersubscription – Economic Analyst assures
Story By: Rebecca Okine
Economic Analyst at Zed, Mr. Emmanuel Boateng has called on Ghanaians to not be overly concerned about the government’s recent Treasury bill undersubscription.
His remarks come follow the latest auction results released on May 2, 2025, which showed the government raising GH₵ 5.29 billion, falling short of its GH₵ 6.32 billion target. Out of the amount raised, only GH₵ 4.72 billion was accepted.
Speaking on the Business Breakfast on Zed 101.9 FM yesterday, Mr. Boateng attributed the undersubscription to declining interest rate which is making Treasury bills less attractive to investors.
“When yields that were once around 20% drop to 13% or 14%, it naturally reduces investor appetite,” he explained. “Investors want high returns with little to no risk, but falling rates shift their interest.”
He also pointed to liquidity constraints as a secondary reason, noting that some potential investors may simply not have the money to invest at the moment.
“If people’s pockets aren’t deep enough to support investments, they’re not going to participate even if they want to,” Mr. Boateng said.
Despite falling short of its target, the government deliberately rejected some bids in the auction—particularly for the 182-day and 364-day bills, which offered higher yields. Boateng described this as a strategic move to control borrowing costs.
“The government could have taken more but chose not to. That’s a cost-saving decision, not a sign of market failure.”
While some may interpret the outcome as a shift by investors toward alternative instruments, Boateng stressed that the situation does not indicate a loss of confidence in government securities. “One or two failed auction targets are not alarming in themselves—especially when the underlying reasons are not severe,” he said. In summary, Boateng’s assessment is that the undersubscription is largely driven by economic fundamentals namely falling rates and limited liquidity not by panic or loss of trust. For now, he suggests there’s no need for alarm.
