Ghana has made a significant breakthrough in its economic recovery efforts, saving approximately GH¢1 billion due to the recent reduction in Treasury bill rates.

This remarkable achievement was revealed by the Minister of Finance, Cassiel Ato Forson, during the National Economic Dialogue on March 3, under the theme “Resetting Ghana: Building the Economy We Want Together”.

According to Dr. Ato Forson, the savings generated from the lower Treasury bill rates will be redirected towards critical sectors of the economy to promote development and ensure a stable and prosperous environment for Ghanaians.

He emphasized the need to reduce borrowing and lower the cost of debt as part of efforts to generate more funds for national development and economic restructuring.

“The recent reduction in T-Bills alone is saving Ghana about one billion Ghana cedis, and that amount can be channelled into critical areas of the economy. We need to take steps to reduce borrowing and lower the cost of borrowing so that we can reinvest the savings into national development,” Ato Forson stated .

The reduction in Treasury bill rates is a result of strong investor demand and the Treasury’s recent rejection of higher bids, which has influenced shifting yield expectations. The rates, which started the year between 28% and 30%, have now fallen to an average range of 20% to 22%. This steep decline marks one of the most significant drops in decades.

The 91-day Treasury bill, for instance, has dropped from 28.34% to 20.79%, reflecting a 760-basis-point decline. Similarly, the 182-day bill has fallen from 28.96% to 22.98%, a 600-basis-point drop. The 364-day bill, which previously yielded 30.17%, has now declined to 22.69%, marking a significant 750-basis-point reduction.

Source: Phalonzy