Despite a decline in Treasury bill yields, Ghana has retained its position with the highest interest rates in Africa for 2023, according to reports from various investment firms.
The Fixed Income Update reveals that the interest rates for the 91-day and 182-day treasury bills stand at approximately 29.24% and 31.88% respectively, maintaining an elevated level despite a 6.12% and 4.10% fall in yields for the 91-day and 182-day bills throughout 2023.
The persistently high rates have raised concerns about the government's cost of borrowing in the domestic market.
Despite a notable decrease in rates in March 2023 due to the Domestic Debt Exchange Programme, the decline proved short-lived.
Notably, Ghana also ranks among the African countries with the highest average lending rates, hovering around 32%, further underlining the financial challenges faced by the nation.
Analysts express optimism that treasury yields might decline in 2024, potentially becoming more pronounced as investor sentiments improve.
However, they caution against election-related fiscal risks, emphasizing the potential impact on inflation and its consequent effect on yield outlook.
Egypt closely follows Ghana in the rankings, securing the second-highest interest rates in Africa with a 91-day bill rate of 25.68% and an 182-day bill rate of 25.95%.
In contrast, Cape Verde and Seychelles have recorded the lowest interest rates on the continent, offering a diverse spectrum of interest rate scenarios across African nations.
