New bonds issued by government in 2026 offer much better yields depending on the specific tenor
Institutional portfolio investors are aggressively shifting their portfolios toward restructured Domestic Debt Exchange Programme (DDEP) bonds and benchmark government bonds due to the dramatic collapse in short-term interest rates and a stabilizing macroeconomic environment in late 2026. This is affecting subscription and trading patterns on both the primary market and the secondary market (Ghana Fixed Income Market, GFIM).
Underpinning the changed behavior of these investors is their search for significantly wide positive margins over and above the inflation rate as the Bank of Ghana’s aggressive monetary easing cycle has slashed the 91-day Treasury bill rate to just 4.6 percent (down from over 10.3 percent a year ago). With inflation stabilizing around 5.2 percent, T-bills now offer negative real returns.
Throughout early and mid-2026, ample market liquidity fueled consecutive over-subscriptions across primary T-bill auctions. However, as the Bank of Ghana aggressively cut policy rates, short-term yields plummeted under inflation—with the 364-day bill dropping to 9.98 percent and the 91-day bill falling to 4.69 percent. As a direct result, primary T-bill auctions have begun experiencing net under-subscriptions because commercial banks and asset managers divert funds elsewhere
Within the primary T-bill market itself, subscription data reveals a massive structural preference for the 364-day Treasury bill over the 91-day and 182-day papers as they yield roughly 9.9 percent, resulting in a real (inflation-adjusted) return of 4.7 percent.
Investors looking to maintain short-term liquidity profiles are locking in the maximum duration possible on the primary money market to guard against collapsing overnight interest rates.
New bonds issued by government in 2026 offer much better yields depending on the specific tenor and issue date – for instance the most recently issued four-year government bonds are trading around 11.41 percent, albeit this is down from earlier peaks of about 11.65 percent.
This year’s new government bond issuances form part of the post-restructure and newly issued domestic debt landscape, representing a lower-risk benchmark relative to legacy distressed paper, though representing a small fraction of daily secondary turnover compared to T-bills and DDEP bonds. Appetite for newly issued (post-restructure) Government of Ghana notes and bonds remains highly marginal. Investors prefer buying deeply discounted, pre-existing restructured bonds on the secondary market rather than bidding on fresh sovereign bond tranches.
Indeed, the once disparaged Domestic Debt Exchange Programme (DDEP) restructured bonds have now become the favourite securities of institutional investors such as pension funds, insurance companies and even commercial banks at a time that, driven heavily by portfolio rebalancing, total secondary market trading volume on the GFIM reached a staggering GH¢337.79 billion in the first nine months of 2026. This has already surpassed every full-year performance since the market’s inception in 2015, marking an 85.6 percent jump compared to the same period in 2025.
Restructured DDEP bonds have become the primary liquidity engine of the secondary market. In typical daily sessions, DDEP bonds drive between 50 percent and 65 percent of total market turnover, frequently pulling in over GH¢1.3 billion in a single session.
Unlike the T-bill market—which records thousands of tiny daily transactions from retail and small corporate players—secondary DDEP bond trading is concentrated in fewer, but substantially larger-value institutional blocks. This indicates that major pension funds and commercial banks are conducting large-scale strategic realignments of their asset bases
The most obvious reason for this is that they now offer the best yields on debt securities, trading at a secondary market yield of roughly 14.2 percent (based on mid-curve February 2030 maturities), providing a much higher real return of 9.0 percent. Specifically, February 2029 bonds are trading around 13.86 percent, February 2030 around 14.20 percent, February 2032 around 14.51 percent, and February 2037 around 14.93 percent.
.But beyond the sheer superior yields they offer, government, as their issuer, has won back the confidence of investors, after the shock of the DDEP itself that wiped away significant portions of both their expected cash flows and their expected profits.
A historical hurdle for long-term GoG paper was the fear of default or payment delays. but the Ministry of Finance has now fully operationalized dedicated Sinking Funds, earmarking 7 percent of gross domestic non-oil tax revenues monthly to buffer the massive GH¢111 billion in payment maturities coming due in 2027 and 2028 has this has successfully restored institutional investor confidence.
Deepening market liquidity and better price discovery have both played their parts too. Besides, there is a lack of viable domestic alternatives. Ghanaian private pension funds and commercial banks hold over GH¢63.88 billion in assets, yet structurally maintain a massive 73 percent asset concentration in sovereign securities. Because alternative asset classes—like local corporate bonds or equities—suffer from low market depth and limited issuer diversity, fixed-income managers must rely on longer-dated benchmark government debt to achieve necessary capital preservation.
Indeed it is instructive that the ongoing portfolio rebalancing almost totally excludes corporate bonds which struggle to generate even 0.1 percent of daily market turnover on GFIM, facing severe liquidity limitations and lack of investor interest amidst the massive rush for DDEP bonds where the secondary market’s focus has become so hyper-concentrated in sovereign securities which account for 99.9 percent of all activity.
Yields and coupon rates for corporate bonds range widely from roughly 21.55 percent to 30.39 percent in coupon/interest rates for active corporate issuers such as Bond Financial Services and select energy and agribusiness instruments like COCOBOD or Petrosol notes trading on the market, though market liquidity and trading depth remain very low compared to government paper
Investors have not been enthused by the high yields that still hold sway on some legacy pre-DDEP bonds legacy bonds either. Certain un-exchanged or structurally insulated legacy bonds continue to carry nominal coupons or trade at secondary market deep discounts that elevate their yield to maturity right around the 21 percent threshold. The most notable of these is the 20-year bond, originally issued in August 2019 and due in 2039 with a coupon rate of 20.20 percent. In secondary market blocks where legacy non-restructured or retail-exempt holders’ trade, its market yield sits elevated over 20 percent due to its massive duration profile and risk adjustments.
There is similar reticence by institutional portfolio investors with regards to statutory and state-owned enterprise notes such as the ESLA 7-Year and 10-Year Notes that feature original coupons ranging from 19.85 percent up to 20.50 percent, and the Daakye PLC Bonds which are securitized education infrastructure notes trading at yields ranging between 20.50 percent and 21.80 percent.
