Ghana’s fixed income market processed over GH¢1.1 billion across 590 transactions on Monday, October 21, with treasury bills accounting for the overwhelming majority of activity as investors maintained their strong preference for short term government securities. The trading session captured diverse participation spanning government bonds, corporate debt, and central bank instruments.
Treasury bills dominated the day’s activity with GH¢468.14 million traded through 516 separate transactions, reflecting persistent investor appetite for liquid government paper with near term maturities. This concentration in bills demonstrates the ongoing pattern that has characterized Ghana’s debt markets throughout 2025, where market participants favor flexibility and liquidity over longer duration exposures despite the country’s improving economic fundamentals.
New government notes and bonds contributed GH¢463 million through 40 trades, indicating substantial institutional activity in benchmark sovereign securities. The largest single transaction involved a bond maturing December 2, 2031, which carries an 8.95 percent coupon. This security traded GH¢150 million at a yield of 17.26 percent and closed at a price of 71.33 cedis per 100 cedis face value, reflecting the elevated rate environment that continues characterizing Ghana’s sovereign debt market.
The substantial discount to par value on this 2031 bond illustrates how dramatically market yields have risen since original issuance. When a bond carrying an 8.95 percent coupon must offer a 17.26 percent yield to attract buyers, it signals investors demand significant risk premiums for holding longer dated Ghanaian government debt despite macroeconomic stabilization progress.
Old government bonds, those issued before Ghana’s 2023 debt restructuring program, recorded minimal activity with just GH¢99,600 traded across four transactions. The most active legacy bond, maturing January 18, 2027, carries a 19.25 percent coupon and traded at a yield of 25.53 percent with a closing price of 93.51 cedis. These elevated yields on restructured debt reflect market perceptions about credit quality differences between pre and post exchange securities.
Corporate bond activity showed modest but meaningful participation. Cocoa Marketing Board securities led the segment with GH¢2.68 million traded through five transactions. The CMB bond maturing August 30, 2027, which carries a 13 percent coupon, closed at a price of 98.05 cedis. This quasi sovereign issuer continues attracting more consistent investor interest than purely private sector corporate bonds, benefiting from implicit government backing given cocoa’s strategic importance to Ghana’s economy.
Bank of Ghana bills contributed GH¢36.31 million through 12 trades, demonstrating moderate activity in the central bank’s monetary policy instruments. These securities serve specific purposes for financial institutions managing reserve requirements and liquidity positions, though they typically generate less secondary market activity than treasury bills or government bonds.
Sell and buyback trades, Ghana’s version of repurchase agreements, posted substantial volumes totaling GH¢130.18 million across 13 transactions. These repo style arrangements allow investors to access temporary liquidity while maintaining exposure to government bond positions, providing portfolio flexibility that pure buy and hold strategies cannot match. The active repo market signals sophisticated institutional management of both investment returns and cash flow needs.
The overall billion cedi trading day reflects healthy market functioning despite the heavy concentration in government securities. What’s notable isn’t just the total volume but the distribution across different security types and maturity profiles, indicating that Ghana’s fixed income market offers genuine choice for investors with varying risk appetites and time horizons.
Treasury bill trading on Monday spanned all three standard tenors of 91 days, 182 days, and 364 days. The most actively traded bill, maturing November 17, 2025, recorded GH¢133.46 million in volume through six transactions and closed at 99.60 cedis. This concentration in bills with just weeks until maturity demonstrates investors prioritizing capital preservation and immediate liquidity over yield enhancement.
The yield environment across Monday’s trading continued reflecting the elevated rate structure that has persisted throughout 2025. Government bonds traded in a range from roughly 17 percent to 25 percent depending on maturity and whether they were new or old series securities. Corporate bonds showed similar pricing dynamics, with the CMB security’s 98.05 cedi closing price indicating trading slightly below par despite the issuer’s strong credit profile.
Market participants watch these daily trading patterns for signals about investor sentiment and liquidity conditions. Monday’s solid volumes across multiple security categories suggest sustained confidence in Ghana’s debt markets, though the continued dominance of short term instruments indicates persistent caution about longer duration commitments.
For portfolio managers, the current fixed income landscape presents both opportunities and challenges. Yields in the 17 to 25 percent range provide attractive nominal returns and positive real yields given inflation’s recent decline. However, achieving those returns requires accepting either sovereign credit risk on government securities or illiquidity risk on corporate bonds where secondary market trading remains thin.
The persistent gap between government and corporate bond activity highlights ongoing challenges in developing Ghana’s private sector debt market. While government securities benefit from benchmark status, regulatory support, and perception of sovereign backing, corporate issuers struggle to attract consistent investor attention. This imbalance limits financing options for businesses while restricting diversification opportunities for fixed income investors.
Infrastructure supporting Ghana’s fixed income trading has matured significantly over recent years. The Ghana Fixed Income Market platform provides electronic trading infrastructure displaying live, executable prices primarily for government securities. This transparency has improved price discovery and transaction efficiency compared to purely over the counter arrangements that previously dominated.
However, the platform’s success in government securities hasn’t translated into vibrant trading across all fixed income categories. Corporate bonds, quasi government paper from entities beyond Cocobod, and even some government bond series see sporadic activity at best. The result is a bifurcated market where liquidity concentrates heavily in benchmark securities while other instruments trade infrequently.
Looking ahead, several factors will influence Ghana’s fixed income market trajectory. Bank of Ghana monetary policy decisions affect the entire yield curve, with any shifts in the policy rate rippling through pricing across all tenors. Inflation dynamics determine whether current nominal yields translate into attractive real returns or merely compensate investors for purchasing power erosion.
Government borrowing needs also matter substantially. Ghana’s domestic debt stock relies heavily on continuous rollover of treasury bills and periodic bond issuances to finance budget deficits. If investor appetite were to shift suddenly, perhaps due to external shocks or domestic political developments, the government could face refinancing challenges that might require yield increases to maintain market access.
International context adds another layer of considerations. Global interest rate movements, emerging market sentiment, and regional developments in West Africa all influence how international investors view Ghanaian fixed income opportunities. While domestic institutional investors dominate current trading, foreign participation can provide additional liquidity and potentially moderate yields if Ghana is perceived as offering attractive risk adjusted returns.
The concentration of Monday’s trading in near term securities reflects broader patterns visible throughout 2025. Investors continue preferring to roll short term positions rather than extending duration, creating refinancing pressure for the government while limiting opportunities for issuers to lock in longer term funding at prevailing rates. This behavior, while understandable given Ghana’s recent economic challenges, perpetuates a cycle where neither borrowers nor lenders commit to extended maturities.
Corporate bond market development remains crucial for expanding business financing options beyond traditional bank lending. Yet progress has been slow, constrained by limited credit analysis capacity, regulatory barriers affecting institutional investor allocations to corporate debt, and issuer concerns about the costs and disclosure requirements associated with public bond offerings.
Monday’s trading session demonstrated that Ghana’s fixed income market continues functioning effectively for its core purpose of facilitating government securities trading. The billion cedi volume, broad participation across 590 transactions, and active repo market all signal healthy market dynamics. Whether that functionality can expand to encompass more vibrant corporate bond trading and greater investor willingness to extend duration remains an open question as 2025 enters its final quarter.
Source: newsghana.com.gh
