The government failed to hit its treasury bills target for the fourth straight week, according to auction results from the Bank of Ghana. The Treasury raised GH¢3.379 billion, falling short of its GH¢4.551 billion target by approximately 24%, and ultimately accepted GH¢2.952 billion.

Analysts attribute this shortfall to investor preference for Bank of Ghana bills, which offer a lucrative rate of 27% — well above the inflation rate of 18.4%.

Demand was driven mainly by the 91-day treasury bill, with investors submitting GH¢62.418 billion, accounting for 71.55% of total bids. The Treasury accepted GH¢2.191 billion of these.

Meanwhile, the 182-day treasury bill attracted GH¢716.29 million, of which GH¢603.74 million was accepted. The 364-day bill received GH¢236 million in bids, with GH¢157.76 million accepted.

Despite the weak demand, interest rates on the short end of the yield curve continued to inch lower. The 91-day bill yield fell by one basis point to 14.69%, while the 182-day rate held steady at 15.25%. The 364-day yield slipped slightly to 15.69%, down from 15.74% the previous week.

The Governor of the Bank of Ghana, Dr. Johnson Asiama, has assured Ghanaians that the country’s economy is well-positioned to withstand potential external shocks stemming from the ongoing conflict between Iran and Israel in the Middle East.

Speaking at the Ghana Association of Banks Industry Thought Leadership Programme, themed “Banking the Last Mile: An Industry-Led Strategy for Accelerating Digital Finance”, Dr. Asiama highlighted that Ghana’s strengthened foreign reserves, improving inflation trends, and sustained fiscal adjustments serve as robust buffers during uncertain global times.

He emphasized that the Bank of Ghana is actively monitoring global developments and their possible effects on the domestic economy.

“I wish to assure the public that Ghana’s macroeconomic buffers are stronger today than they have been in recent years,” Dr. Asiama stated.

He added that the Bank is also engaging international partners to ensure a proactive response to any arising threats. “The Bank stands ready to take prudent and pre-emptive measures to preserve Ghana’s economic stability and protect the gains we’ve made,” he said.

Impact of Middle East Tensions on Oil Prices

Meanwhile, concerns are mounting over the possible rise in fuel prices. Dr. Riverson Oppong, CEO of the Ghana Chamber of Oil Marketing Companies, recently told JOYBUSINESS that crude oil prices on the international market could surge from July 1, 2025, due to the escalating conflict in the Middle East.

If this trend continues, it could reverse the steady drop in fuel prices experienced since February 2025. Oil prices have already declined from $78 to about $74 per barrel since June 16.

In response to the growing uncertainty, President John Mahama has instructed the Finance and Energy Ministries to implement strategic measures to cushion the economy against possible shocks.

“Despite the work we have done in stabilizing the economy, Ghana is not immune from the shocks of global events,” the President noted.

Sources indicate that the government may announce specific interventions ahead of the upcoming Mid-Year Budget Review, with multiple options currently being considered.

The Governor of the Bank of Ghana, Dr. Johnson Asiamah, has refuted claims that the Central Bank is deliberately manipulating the exchange rate to drive the recent appreciation of the Cedi.

The local currency has recorded significant gains in recent weeks, sparking speculation that the Central Bank may be employing artificial measures to influence its value.

Speaking at the Ghana CEO Summit held in Accra on Monday, May 26, 2025, Dr. Asiamah attributed the Cedi’s performance to sound macroeconomic fundamentals.

“Our Cedi has appreciated by 24.1% against the US dollar. Let me emphasise that the Central Bank is not using international reserves to prop up the Cedi, nor are we engineering an unsustainable appreciation,” he said.

According to Dr. Asiamah, the Cedi’s strength is underpinned by disciplined monetary policy, targeted foreign exchange reforms, improved remittance flows, and enhanced market surveillance.

“These are not short-term interventions—they are deliberate, structural changes aimed at ensuring long-term stability,” he added.

Source: Citi Newsroom