Ghana is pressing ahead with plans to raise about 4.48 billion cedis in its latest Treasury bills auction, even as recent auctions have fallen short of target and underscored a more selective tone in investor demand. But market participants say the weakness does not necessarily reflect a collapse in appetite for government paper. Instead, investors are rotating toward instruments offering better returns, particularly bonds and shorter-dated bills.
Speaking to CNBC Africa, Mary Mensah-Okang, head of trading at Access Bank Ghana, said the market still has liquidity and investor interest, but demand is being reshaped by yield considerations.
“We wouldn’t necessarily say that the appetite has gone low,” Mensah-Okang said. “The appetite is there. It’s just that we have some investors that would rather go for alternatives that have slightly higher yields with the same issuer.”
Her comments suggest that Ghana’s recent auction underperformance is less about broad risk aversion and more about pricing resistance from investors seeking improved returns from the sovereign. According to Mensah-Okang, investors are increasingly gravitating toward bonds, which are currently offering somewhat higher yields than Treasury bills, helping explain why T-bill subscriptions have softened relative to government targets.
She noted that even in last week’s auction, where subscription came in roughly 400 million cedis below expectations, the government still appeared unwilling to accept some bids priced above its preferred levels. That points to a mismatch between investor yield expectations and the rates authorities are prepared to pay.
In effect, the pressure in Ghana’s money market is not solely a demand problem. It is also a pricing problem, as investors compare Treasury bills with other sovereign instruments and choose where value is strongest.
Still, Mensah-Okang struck a relatively constructive tone on system liquidity. She described the market as “fairly and quite liquid,” citing continued participation across multiple instruments, including Bank of Ghana bills and Treasury securities. Demand has also remained visible in the bond market when it has reopened, reinforcing the view that cash remains in the system, even if investor allocations are shifting along the curve.
That liquidity backdrop is important for policymakers as Ghana navigates funding needs while trying to avoid paying materially higher borrowing costs. Strong liquidity generally supports issuance, but selective demand means authorities may need to calibrate issuance strategy carefully if they want to improve auction outcomes without pushing rates sharply higher.
The foreign exchange market is also drawing close attention. After a dramatic turnaround that saw the cedi move from one of the worst-performing currencies to one of the stronger performers globally, questions are now growing over whether Ghana is entering a new FX cycle.
Mensah-Okang said the cedi is likely to remain under moderate depreciation pressure rather than experience a sharp swing lower. She attributed recent weakness largely to seasonal demand dynamics in the second quarter, when corporates publish financial results, remit dividends and step up payments to suppliers.
“The depreciation pressures would be there, but I don’t think it’s going to be a sharp swing. It’s going to be marginal,” she said.
She added that the Bank of Ghana remains a key stabilizing force in the market, intervening to damp volatility when moves become too rapid. The central bank has also continued to support the market through foreign exchange supply linked to gold flows, with around $1 billion reportedly pushed into the market over the past four months.
On her near-term outlook, Mensah-Okang said she expects the cedi to weaken only modestly by month-end, with depreciation capped at around 6% and the currency settling near 11.15 to the dollar from around 11.09 currently.
Beyond Ghana, the interview turned to broader geopolitical and trade developments, including the extension of the ceasefire between Israel and Lebanon. While the diplomatic development may reduce some immediate fears of escalation, business leaders say it is unlikely to materially ease trade disruptions in the near term.
Bolaji Sofoluwe, managing director at ETK Group, said the extension has not yet restored the confidence needed for global trade flows to normalize.
“One of the things that trade needs is trust, and people are still very hesitant about the current situation in the Middle East,” Sofoluwe said. “The fragile ceasefires have not instilled a lot of confidence in the trade space.”
She said insurance costs remain elevated, particularly for shipping and logistics, while aviation fuel shortages are also beginning to affect operations in some markets. That is feeding into freight flight cancellations and sharply higher logistics expenses, with knock-on effects for African trade.
In her view, the ceasefire extension alone is unlikely to bring meaningful short-term relief to shipping routes or insurance premiums, meaning African importers and exporters may continue to face high trade costs for some time.
Sofoluwe also pointed to improving momentum in Nigeria-UK commercial ties following President Bola Tinubu’s state visit to Britain earlier this year. She said engagement with about 30 UK companies is a promising sign that high-level diplomacy may be translating into practical business deals.
Even so, she emphasized that Nigeria still needs to address a trade imbalance with the UK. While bilateral trade stands at roughly $8.1 billion, Sofoluwe said the deficit remains significant at around $3.3 billion, underscoring the need for more balanced and equitable trade growth.
She added that the African Continental Free Trade Area is gradually strengthening investor appetite by creating a more integrated commercial outlook across the continent. Rather than viewing African opportunities country by country, foreign firms are increasingly considering regional expansion strategies.
On trade finance, Sofoluwe welcomed moves by African banks to develop yuan-denominated settlement and credit facilities, including partnerships involving Chinese institutions. She said direct yuan settlement could reduce the added cost of converting African currencies into dollars and then into yuan, a process she estimated had been costing traders nearly 4% per transaction.
Given the scale of Africa-China trade, she said those savings could be meaningful. While she acknowledged that a broad shift away from the dollar could eventually draw a policy response from the United States, she said such a reaction is unlikely in the immediate term.
Taken together, the interviews painted a picture of an African financial and trade landscape that remains resilient but highly price-sensitive. In Ghana, investors are still active but increasingly demanding better value. Across trade corridors, geopolitical uncertainty continues to keep costs elevated. And while policymakers and businesses are finding alternative channels for finance and commerce, confidence remains the key variable.
For now, Ghana’s auction results, cedi stability and Africa’s wider trade outlook will depend not just on liquidity or diplomacy, but on whether markets see enough value and enough trust to commit capital decisively.