IC Fixed Income and Currency Guide

In brief

GHANA

Fixed Income:
Tighter liquidity and inflation risk raise upside risk to yields. Ghana’s T-bill primary market was well supported in May 2026, with most auctions oversubscribed and demand exceeding targets amid higher yields across the curve. While current bid levels should cover the larger maturities in June 2026, we believe the new CRR directive could divert liquidity from T-bills and lift yields further.

GRR Watch: We expect the Ghana Reference Rate (GRR) for June 2026 to tick up by 14bps to 10.17% as higher CRR to 20% is only partly offset by marginally lower interbank interest rate and the 91-day yield.

Currency:

Surging FX demand deepens pressure on the Cedi. The Ghanaian Cedi weakened 4.6% in May 2026 as corporate and portfolio-driven FX demand far exceeded the BOG’s supply, with auction demand reaching nearly four times available liquidity. We expect pressure on the currency to persist in June 2026 as elevated energy prices continue to drive FX demand. The rapid pace of depreciation however leaves room for late-year correction.

KENYA

Fixed Income:
Tighter refinancing conditions keep yields elevated. Investor demand for Kenyan T-bills improved in May 2026 but remained insufficient to fully cover maturities, while rising inflation expectations pushed yields higher. With maturities set to increase further in June, we expect continued auction pressure and elevated yields.

Currency:
External pressures weigh mildly on the Shilling. The Kenyan Shilling eased 0.2% in May 2026 as renewed US dollar strength and external shocks offset April’s gains. That said, resilient remittances, tourism receipts and agricultural exports continue to support stability, despite rising fuel costs weighing on reserves and trade balances.

NIGERIA

Fixed Income:
Supportive liquidity sustains demand despite softer bids. Favourable liquidity conditions continued to support Nigeria’s T-bill market in May 2026, with demand comfortably covering the lower issuance targets despite weaker bids. Yield movements mirrored the prior month, as mid- to long-end rates eased while the front end remained broadly stable.

Currency:
Stronger reserves continue to anchor the Naira. The Naira posted a modest 0.2% gain in May 2026 as higher oil earnings, improved investor participation and firmer FX reserves supported external liquidity. We expect relative stability to persist, although easing geopolitical tensions and weaker oil prices could temper FX inflows.

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