Market liquidity in the money markets last week helped improve the performance of the Treasury bill auction despite the sale of the infrastructure bond that had been expected to affect the sale of the short-term securities.
Central bank said it raised Sh21.6 billion in the T-bill auction, from bids worth Sh225 billion, meaning it got 90 percent of the targeted Sh24 billion.
In the previous week’s auction, the government had managed to raise 78 percent of the target, after accepting Sh18.7 billion from bids worth Sh20.9 billion.
“The liquid environment supported the uptake of T-Bills at the auction… (although) the week has been relatively quiet after the bond auction with speculation rife on a tap sale,” said Genghis Capital in a market note.
But nce again, investors showed a preference for the one-year T-bill, which raised Sh11.9, with the 91-day paper also making a strong showing with acceptances of Sh7.3 billion against the targeted Sh4 billion.
In recent weeks, investor preference has almost exclusively been on the one-year paper, which has been experiencing oversubscriptions while the two shorter duration T-bills have been undersubscribed.
Rates on T-bill remained flat during the week, changing only by a few basis points across all three tenors.