Weekly Highlights

• 91-Day T-Bill down by 3 basis points to 12.87 percent.
• GSE Benchmark Composite Index resumed uptrend, following price surge in Scancom Ltd.
• Ghana cedi advanced against all the three major trading currencies.
• Wallstreet gained, driven by demand uptick for shares within the technology, healthcare, and financial sectors.
• Brent crude oil falls as COVID-19 pandemic infections rekindled in some parts of Europe.

Macroeconomic update
Key Ghana Economic Data

Indicator 2018 2019 2020 2021 2021
Target Actual
Inflation CPI (y-o-y %) 9.40 7.90 10.40 8.00 9.90
Inflation PPI (y-o-y %) 4.40 13.00 7.00 n/a 10.3
Monetary Policy Rate (%) 17.0 16.00 14.50 n/a 14.50
GDP Growth (y-o-y %) 6.3 6.5 0.9* 5.00 n/a
Budget Deficit (% of GDP 3.8 4.5Sep 11.7 9.50 n/a
Public Debt (% of GDP) 57.6 63.00 68.3 n/a n/a
Fx. Reserves (M. Cover) 3.7 4.1 4.1 4.00 n/a
Source: BOG; MOFEP; GSS. * represents provisional estimate ** data yet to be released by MoF

Government of Ghana Treasury Securities
Treasury Bills, Notes & Bonds (%)
Date 91-Day 182-day 364-day 2-Yr 3-Yr 5-Yr
Mar29–Apr02 12.87 13.65 16.57 17.60 17.70 18.30
Mar 22 – 26 12.90 13.66 16.67 17.60 17.70 18.30
Mar 15 – 19 13.00 13.85 16.67 17.60 19.25 18.30
2021 Yr. Open 14.09 14.12 17.00 18.50 19.25 19.85
NB: The above are the annual yields on Government of Ghana Treasury Securities.

Interest rates on the short-dated treasury securities recorded another round of moderation. This follows easing uncertainties associated with the COVID-19 pandemic and rising consumer and business sentiment in the economy. At the close of the week’s auction, the yield on the 91-Day T-Bill moderated by 3 basis points to settle at 12.87 percent. Interest rates on the 182-Day and 364-Day T-Bill also dropped by a basis point and 10 basis points to settle at 13.65 percent and 16.57 percent, respectively. The yields on the Government of Ghana treasury notes and bonds, however, remained unchanged as they were not part of the week’s issuance.

Results of Auction held on 26th March, 2021

Bill Bids Tendered GHS (Million) Bids Accepted GHS (Million) Interest Rate (%)
91-Day T-Bill 983.72 983.72 12.8962
182-Day T-Bill 135.42 135.42 13.6573
3-Year Bond 1,610.11 1610.11 17.7000

Government accepted all the GHS1,682.20 million worth of bids tendered by investors at the week’s auction. The amount raised was more than the week’s targe of GHS1,342.00 million, with the 91-Day T-Bill dominating Government’s purchase. It is the expectation of the Government to raise a total of GHS666.00 million bids from the sale of the 91-Day and 182-Day T-Bills at the upcoming auction, scheduled on Thursday 1st April 2021.

Following the rate moderation witnessed on the 3-Year Bond at the previous auction, the yield curve sustained both its normality and a smooth curve. Thus, returns on long-dated treasury securities were comparatively higher than the short-dated counterparts. Interest rates are further tipped to fall on the back of commitment by the Government to boost private sector development through reducing the cost of capital for business. Further rate cuts, coupled with stability of the local currency against major trading currencies amidst effort to control inflationary pressures, could stimulate the monetary policy committee of the Bank of Ghana to lower the policy rate in their next policy review.

Ghana Stock Exchange

Ghana Stock Exchange (GSE) Indices (YTD %)
Year 2017 2018 2019 2020 2021
GSE-CI 52.73 -0.29 -12.25 -13.98 14.06
GSE-FSI 49.51 -6.79 -6.23 -11.73 3.72

Trading on the Ghana Stock Exchange ended on a mixed note, with the benchmark Composite Index resuming its uptrend after price recovery in the telecommunication giant – Scancom Ghana Ltd (MTNGH). The GSE Composite Index thus finished 89 basis points higher after the week’s trade, as its index level rose to 2,214.58 points, corresponding to a year-to-date return of 14.06 percent. The GSE Financial Stocks Index was, however, unchanged as no financial sector stock recorded price movements. The Index thus remained at 1,849.04 points, corresponding to a year-to-date return of 3.72 percent.

GSE Market Indicators
Wk. Open Wk. End Change (%)
Total Volume Traded (M) 10.05 1.08 -89.21
Total Value Traded (GHS M) 8.49 1.83 -78.45
Market Cap (GHS M) 56,968.74 57,175.68 0.36

Trading activities slowed in the week under review as compared to the previous week’s outturn that realized a total of 10.05 million shares valued at GHS8.49 million. The week’s trade volume stood at 1.08 million with a corresponding value of GHS1.83 million. This represents 89.21 percent reduction from the previous week’s record. Market activities were largely driven by CAL Bank Ltd and Scancom (MTN Ghana) Ltd as they jointly accounted for 64.23 percent of the traded volume. Market capitalization, however, rose marginally by 0.36 percent to settle at GHS57,175.68.

Stock Price Movements

On the mover’s chart, one advancer and lone laggard were recorded on the Bourse, after pairing the week’s opening and closing prices. MTN Ghana Ltd gained 2 pesewas to trade at 85 pesewas per share.

Stock Price Movers in terms of WK closing prices
Equity Yr. Open Wk. Open Wk. End Wk. Change (GHS) YTD (%)
MTNGH 0.64 0.83 0.85 0.02 32.81

On the flip side, Unilever Ghana Plc dropped significantly by 67 pesewas to end the week’s trade at GHS6.06 per share.

Stock Price Movers in terms of WK closing prices
Equity Yr. Open Wk. Open Wk. End Wk. Change (GHS) YTD (%)
UNIL 8.29 6.73 6.06 -0.67 -26.90

Currency Market
Currency Buying Selling Currency Buying Selling
USD 5.7239 5.7297 CAD 4.5484 4.5531
GBP 7.8996 7.9087 CFA 97.0753 97.1774
EUR 6.7501 6.7572 JPY 0.0522 0.0523
AUD 4.3645 4.3695 ZAR 0.3807 0.3811
NGN 70.9960 71.0956 CNY 0.8749 0.8758
Source: Bank of Ghana 26.03.2021

Trading on the interbank currency market ended with the Ghana cedi outperforming all the three major trading currencies. The US dollar firmed on account of upward revision of US economic growth data for the 4th quarter of 2020 and bullish labour market data in the region. US’ final estimate for its fourth quarter growth for 2020 settled at 4.3 percent, topping a forecast of a 4.1 percent. Weekly jobless claims dropped to its lowest in a year as it fell below the 700,000 mark to settle at 684,000 for the week ended, 19th March 2021. Despite this, the US dollar depreciated by 0.01 percent as it lowered its selling price to GHS5.73. The year-to-date appreciation of the cedi thus rose to 0.58 percent.

The British pound was on the defensive as it dropped to its lowest in six weeks on account of cooling consumer inflation data from the UK. Consumer inflation, surprisingly, slowed to an annual rate of just 0.4 percent in February versus forecasts of an uptick to 0.8% from 0.7% in January. This overshadowed the uptick in British retail sales data, which jumped by 2.1 percent in February from a contraction of 8 percent in January. The British pound thus posted a week-on-week depreciation of 0.40 percent to trade at GHS7.91. The cedi thus lowered its year-to-date depreciation to 0.38 percent.

The Euro dimmed its outlook as news on rising COVID-19 pandemic infections within the Eurozone dented the appeal of the single currency to investors, due to new sets of lockdown restrictions. Germany, France, and Italy were among some member countries that reintroduced new measures to curb the spread of the pandemic, making the Euro fall to its lowest since November 2020. The Euro thus recorded a week-on-week depreciation of 0.83 percent as its selling price dropped to GHS6.76 on the interbank currency market. The cedi thus closed the week’s trade with a year-to-date appreciation of 4.59 percent versus the Euro.

International Market
Stock Indices
Wk. Open Wk. Close Change (%) YTD (%)
S&P 500 Index 3,913.10 3,974.54 1.57 5.82
DJIA 32,627.97 33,072.88 1.36 8.06
FTSE 100 6,708.71 6,740.59 0.48 4.34
NIKKEI 225 29,792.05 29,176.70 -2.07 6.31
FTSE/JSEAllShare 65,911.27 64,783.62 -1.71 9.05
NSE All Share 38,382.39 39,216.70 2.17 -2.62
Nairobi All Share 166.94 166.48 -0.28 9.45

The US equity market finished on a positive note following high demand for shares within the technology, healthcare, and financial sectors, due to speculation that stocks from these sectors are likely to be the most beneficial from the much-anticipated economic recovery. The S&P 500 thus rose by 1.57 percent to settle at 3,974.54 points. The Dow Jones Industrial Average also ended with a week-on-week rise of 1.36 percent to settle at 33,072.88 points.

The London Stocks Exchange rebounded as the uptick in crude oil prices on the international commodity market buoyed the value of the heavily weighted energy sector stocks – BP Oil and Shell Oil. The FTSE 100 thus gained 0.48 percent to settle at 6,740.59 points.

The Japanese Stocks Exchange headed southwards on account of losses recorded within the Paper & Pulp, Railway & Bus and Real Estate sectors. The Nikkei 225 thus went down by 2.07 percent to settle at 29,176.70 points.

On the African equity market, the Nigerian All Share Index reversed previous week’s downtrend by 2.17 percent as its index level settled at 39,216.70 points. The Johannesburg All Share Index, however, dropped further by 1.71 percent to settle at 64,783.62 points. The Nairobi All Share Index also recorded a weekly decline of 0.28 percent to end the week’s trade at 166.48 points.

Commodities
Wk. Open Wk. Close Change
(%) YTD (%)
Crude Oil $/barrel 64.53 64.57 0.06 24.65
Gold $/ounce 1,741.70 1,732.30 -0.54 -8.59
Cocoa$/metric tonne 2,493.00 2,458.00 -1.40 -5.57
Coffee $/pound 1.2545 1.285 2.43 0.19
Source:www.bloomberg.com, & www.investing.com -

Brent crude oil sustained another weekly gain despite fresh coronavirus restrictions in Europe which dent the demand outlook of the energy commodity. The gains in the energy commodity, spurred from supply interruption in the Suez Canal, one of the world’s busiest shipping channels for oil and refined fuels, grain and other trade between Asia and Europe, which was blocked by ship container. Brent crude oil thus gained 4 cents to trade at $64.57 per barrel.

Gold recorded its first weekly decline in three weeks as interest rates on the US Treasury yields resumed uptrend. The interest rate on the US 10-year Treasury note rose to 1.63 percent and that on the 30-year Treasury bond also jumped to 2.35 percent to negatively affect the demand for the yellow metal in the week’s trade. Gold thus shed $9.40 to settle at $1,732.30 per ounce.

Coffee price rose marginally on the international commodities market as new COVID-19 restrictions in Germany, France and Italy dimmed the global demand outlook of the soft crop. Coffee consumption, which is anticipated to dwindled on account of these restrictions, affected the value of the crop in the week’s trade. Coffee only added 3 cents on account of dry weather conditions in Brazil to end the week’s trade at $1.29 per pound.

Cocoa fell to a month low on demand and ample supply concerns of the beans on the international commodities market. Supply concerns due to favourable climatic conditions in Ivory Coast, coupled with demand concerns on account of resurgence in infection cases across Europe, weighed on the soft crop. Cocoa thus went down by $35.00 to trade at $2,458.00 per metric tonne.

Note: The data in this publication is Friday on Friday (w/w)