Treasury bills subscription dropped to an average 155.4 per cent last week compared to 209.2 per cent recorded the previous week.
Subscription rates for the 91-, 182-, and 364-day government papers came in at 312.5 per cent, 159 per cent and 89 per cent compared to 381.5 per cent, 255.5 per cent and 94.1 per cent the previous week, respectively.
The 364-day paper was again undersubscribed during the week with Central Bank of Kenya (CBK) data showing that investor preference was still skewed towards 91- and 182-day papers.
“The government accepted Sh34.6 billion of the Sh37.3 billion worth of bids received against the Sh24 billion on offer in the auction,” the CBK said.
The significant uptake was an indication of the governments’ appetite for funds to bridge the budget deficit.
The T-bills subscription rates remained high in May, rising to 168.9 per cent from 131.8 per cent in April due to the high liquidity.
In recent weeks market analysts have been expecting demand to remain high on the shorter dated papers on high liquidity.