Copyright ghanamma
Ghana’s fixed income market demonstrated stark contrasts in investor appetite September 26, 2025, with treasury bills capturing GH¢1.13 billion in trading volume while new government bonds from the debt restructuring programme attracted just GH¢1.74 million across a single transaction. The trading data from the Ghana Fixed Income Market (GFIM) reveals a market increasingly focused on short-term government securities as investors maintain cautious positioning amid ongoing economic stabilization efforts. The preference aligns with recent inflation data showing rates at 11.5% in August 2025, marking the lowest level in four years. Treasury bills dominated the session with 10 separate transactions, led by 91-day instruments maturing October 20, 2025, which accounted for the largest single volume component. The concentration in short-term instruments reflects investor preference for liquidity and frequent repricing opportunities rather than locking into longer-term commitments. Corporate bond activity showed surprising strength, with Cocoa Board securities generating GH¢20.4 million across 22 transactions. The state-owned commodity trading entity’s bonds maturing August 30, 2027, represented the entire corporate trading volume, highlighting the narrow depth of Ghana’s corporate debt market beyond government-backed entities. Bank of Ghana (BoG) bills recorded GH¢165 million in a single large transaction, demonstrating institutional demand for central bank instruments. The transaction size suggests pension fund or insurance company positioning, typical institutional behaviors when managing liquidity requirements. The minimal activity in new Government of Ghana (GoG) bonds reveals ongoing market hesitation around instruments created through the Domestic Debt Exchange Programme (DDEP). These securities became benchmark bonds following the successful completion of Ghana’s debt restructuring, yet trading volumes suggest investors remain cautious about longer-term government commitments. Old GoG bonds, representing pre-restructuring instruments, generated GH¢566,000 across three transactions, indicating some residual market interest in legacy securities. These instruments often trade at significant discounts, attracting opportunistic investors seeking higher yields despite elevated credit risks. Sell and buyback arrangements totaled GH¢199.66 million across 15 transactions, reflecting active repo market conditions. These transactions typically serve short-term funding needs for banks and other financial institutions, providing market makers with inventory management tools. The absence of activity in collateralized and Global Master Repurchase Agreement (GMRA) trades suggests limited institutional demand for structured repo arrangements during the session. This segment typically reflects more sophisticated trading strategies by larger financial institutions. Yield patterns across the trading session showed typical term structure characteristics, with longer-dated instruments commanding higher returns. New GoG bonds displayed yields ranging from 15% to 23%, reflecting both credit risk premiums and term risk compensation demanded by investors. The trading patterns mirror broader trends in Ghana’s post-restructuring financial markets. Recent sessions have recorded volumes exceeding one billion cedis, underlining the substantial scale of Ghana’s domestic debt market operations, though the composition heavily favors short-term instruments. Market participants attribute the treasury bill preference to several factors: improved government fiscal discipline, clearer monetary policy signals from the BoG, and international investor confidence following successful International Monetary Fund (IMF) programme implementation. The corporate bond segment’s reliance on Cocoa Board highlights structural challenges in Ghana’s capital markets. Private sector entities remain largely absent from bond markets, reflecting both regulatory constraints and investor risk appetite limitations for non-government backed credits. Technical market indicators suggest increasing sophistication in Ghana’s fixed income infrastructure. The GFIM platform processed 52 separate transactions across multiple security categories, demonstrating operational capacity for handling diverse trading requirements. Regional context shows Ghana’s fixed income market development exceeding many West African peers in terms of electronic trading capabilities and instrument diversity. The presence of corporate bonds, central bank bills, and structured repo arrangements positions the market favorably for continued development. Looking ahead, market observers expect continued concentration in short-term instruments until investor confidence in Ghana’s long-term fiscal trajectory strengthens further. The government’s ability to demonstrate consistent debt service on new restructured instruments will likely determine when longer-term bond trading volumes recover. Financial sector implications extend beyond immediate trading profits. Banks and insurance companies rely heavily on government securities for regulatory capital and asset-liability matching, making treasury bill market liquidity crucial for broader financial system stability. The session’s GH¢1.33 billion total trading volume represents approximately 0.02% of Ghana’s gross domestic product, indicating substantial domestic savings mobilization through capital markets. This metric compares favorably with regional peers and demonstrates the growing importance of domestic debt markets in Ghana’s financial system.
