The Treasury accepted a total of Sh98.63 billion from investors who had offered Sh118.14 billion.
Central Bank of Kenya (CBK), the government’s fiscal agent, had advertised a total of Sh96 billion for the three tenors (91-, 182-, and 364-day).
The 91-day paper continued to sell below its five-year average of 9.2 per cent.
The lower yield on the three-month paper is mainly attributable to a low-interest rate environment being experienced since the passing of the law capping interest rates.
Treasury bills were oversubscribed in April at the rate of 123.12 per cent, boosted by the uptake of the six-month and one-year tenors.
The Treasury accepted a total of Sh98.63 billion from investors who had offered Sh118.14 billion.
Central Bank of Kenya (CBK), the government’s fiscal agent, had advertised a total of Sh96 billion for the three tenors (91-, 182-, and 364-day).
“The yields on the 91-day and 364-day papers remained flat at eight per cent and 11.1 per cent respectively, while the yield on the 182-day paper declined by 10 basis points (bps) to 10.3 per cent from 10.4 per cent the previous month,” said analysts at Cytonn Investments in a note to investors.
In April, the 182- and 364-day papers saw an oversubscription with the rates coming in at an average of 122.2 per cent and 141.0 per cent respectively while that of 91 day was at 80.70 per cent.
The 91-day paper continued to sell below its five-year average of 9.2 per cent.
The lower yield on the three-month paper is mainly attributable to a low-interest rate environment being experienced since the passing of the law capping interest rates.
Analysts expect this to continue in the short-term, given the discipline of the CBK in stabilising interest rates in the auction market by rejecting aggressive bids priced above market for both Treasury bills and bonds.
The government is under no pressure to borrow from the local market being currently ahead of its domestic borrowing target and in the foreign markets where it has met approximately 86.1 per cent of its prorated target.
The 91-day paper attracted bids worth Sh12.89 billion against a total amount offer of Sh16 billion. The Treasury accepted Sh8.83 billion from investors.
In the 182-day paper, investors had offered Sh48.86 billion against an offer of Sh40 billion. The Treasury accepted Sh40.32 billion, while in the 364-day auctions, the Treasury accepted a total of Sh49.48 billion from Sh56.39 billion against an offer of Sh40 billion.
