Databank Research Flags Mounting Pressure in Treasury Bill Market

Databank Research has cautioned that Ghana’s treasury bill market is likely to remain under significant pressure in the coming weeks, as the government grapples with weak bid volumes and substantial rollover obligations. This dynamic is expected to keep yields elevated in the near term.

According to the firm, the 2026 Budget indicates an even greater dependence on T-bills to rebuild cash buffers—signaling sustained short-term funding needs. Analysts warn that this strategy could drive yields even higher unless market liquidity improves meaningfully.

The pace of yield adjustments, Databank notes, will hinge on changes in the Monetary Policy Rate (MPR) and broader liquidity conditions. With liquidity still constrained and investors demanding higher returns for short-term lending, treasury financing is poised to remain expensive.

“Ghana’s short-term borrowing strategy may prove challenging due to various pain points, including funding pressures, missed targets and rising yields. Of course, all of these factors may be nullified if liquidity conditions see a significant improvement”, says Terence Hove, Senior Financial Markets Strategist at Exness, commenting on the pressure Ghana’s treasury bill market is currently under.

This warning follows a disappointing auction last week, where the Treasury raised GHS 3.83 billion—falling 30.46% short of its GHS 5.68 billion target. The shortfall highlights persistent liquidity tightening and investor hesitance to commit at prevailing rates, despite repeated government efforts to raise short-term funds.

Yields, meanwhile, continued their upward trend across the curve.

Analysts conclude that the combination of missed targets, rising yields, and ongoing funding pressures suggests a tough road ahead for the government’s short-term borrowing strategy—unless liquidity conditions see a marked improvement.