Ghana Debt Market: Treasury Bill Yields Continue to Ease

ACCRA, Ghana — The cost of refinancing Ghana’s short-term domestic debt has declined substantially, with the yield on the government’s one-year Treasury bill falling to 10.1% at the end of August 2026, down from almost 30% in December 2024.

The development offers some relief to government finances by reducing the interest cost associated with refinancing maturing Treasury bills. According to report S&P Global, the yield on the six-month Treasury bill also fell to approximately 6.5% over the same period.

Treasury bills, commonly known as T-bills, are short-term government securities used to raise funds to meet public financing needs. When existing bills mature, the government may issue new ones to repay the outstanding obligations. Lower yields can reduce the cost of this refinancing, provided the government can continue borrowing at comparable rates.

Debt Management Strategy and Market Conditions

Ghana’s reliance on Treasury bills increased after the domestic debt restructuring in 2022. The government subsequently restricted the issuance of new medium- and long-term domestic bonds for three years, leaving short-term securities as an important source of local-currency financing.

The decline in yields has helped ease borrowing pressures. However, the government has also begun issuing longer-term domestic bonds in 2026, a move intended to extend the maturity profile of its domestic debt and reduce the frequency with which obligations must be refinanced.

Extending maturities can help manage refinancing risks, although the interest rates demanded by investors remain an important consideration.

Higher Financing Needs Could Slow Further Declines

Despite the improvement, pressure on government financing has not disappeared.

Recent Treasury bill auctions have seen the government increase the amount it seeks to raise following several weeks when accepted bids fell below its targets. The latest issuance target cited in the report was GH¢5.02 billion, compared with GH¢3.91 billion in bills falling due.

The government raised GH¢1.53 billion above the previous week’s target, potentially providing temporary relief to its funding position. Nevertheless, analysts expect yields to remain broadly stable as elevated financing requirements limit the scope for further declines.

External Risks Remain

The outlook also faces risks from international developments. S&P Global warned that conflict in the Middle East could push inflation and financing costs higher, while increasing pressure on Ghana’s currency, the cedi.

Higher inflation or currency pressures could complicate efforts to sustain lower domestic borrowing costs.

For Ghana, the fall in Treasury bill yields represents a significant improvement from the high-interest-rate environment of late 2024. Sustaining the gains will depend on continued fiscal discipline, investor confidence, debt-management reforms and economic stability.

While lower yields can reduce the government’s refinancing burden, they do not automatically resolve broader public debt challenges. The long-term outcome will depend on the government’s ability to manage borrowing needs while gradually shifting towards more sustainable financing arrangements.