The Bank of Ghana absorbed 19.06 billion cedis from the domestic money market through a 14-day bill auction aimed at managing liquidity and stabilising short-term interest rates, auction results showed.
Results from Tender 861, conducted on May 11, showed the bills were allotted at a weighted average discount rate of 10.4579%, equivalent to an effective interest rate of 10.50% for the investment period.
Bids submitted ranged between 10.40% and 10.49%, with successful allocations concentrated within the same band, according to the central bank.
The operation underscores the Bank of Ghana’s continued reliance on short-term instruments to absorb excess liquidity in the banking system, a key monetary policy tool used to contain inflationary pressures and limit volatility in the foreign exchange market.
The latest liquidity mop-up comes as Ghana’s interest rate environment has eased following a sustained decline in inflation and recent monetary policy adjustments by the central bank.
Despite improving macroeconomic conditions, the scale of the auction suggests policymakers remain cautious about liquidity levels within the financial sector.
For commercial banks, the 14-day bills offer a relatively low-risk short-term investment option at a time when yields on Treasury bills and other government securities have moderated.
The central bank has intensified liquidity management operations in recent months as part of efforts to maintain price stability, its primary policy mandate.
