Capital Markets

Low uptake for T-bills ahead of last week’s polls

cbk

The Central Bank of Kenya mopped up some liquidity. FILE PHOTO | NMG

Treasury bill subscriptions remained low last week as investors approached the market with caution following the General Election, CBK reports show.

Investors offered the government a total of Sh18.59 billion out of the targeted Sh24 billion, compared to the previous week’s offer of Sh28.2 billion.

The lower subscriptions were also indicative of a tighter money market as the Central Bank of Kenya (CBK) mopped up some liquidity in order to fend off exchange rate volatility around the election period.

CBK data shows that the 182-day paper was once gain the most preferred by investors, who put in bids worth Sh9.5 billion out of a target of Sh10 billion.

The Sh10 billion one-year paper attracted bids worth Sh7.9 billion, while the three month offer attracted just Sh1.7 billion having targeted Sh4 billion.

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Unlike previous weeks when the CBK has been rejecting a large amount of mostly expensive bids in order to keep rates in check, the acceptance rate last week was nearly 100 per cent at Sh18.52 billion.

The yields, however, saw little movement in spite of the higher acceptance level, with the 91-day paper steady at 8.19 per cent and the 182-day at 10.32 per cent, while the 364-dayT-bill added 0.02 percentage points to 10.9 per cent.

Financial markets generally recorded limited activity last week, with turnover also falling in the secondary bonds and the equities markets.

Stockbrokers’ banking halls remained largely empty after reopening on Wednesday, with trading mostly done by foreign investors.

Activity is expected to pick up this week depending on the settlement of the presidential election.