Markets analysts anticipate a slightly subdued uptake of Treasury bills this week on the back of the ongoing primary bond sale that closes on September 18.
Improved liquidity supported by government payments helped support the uptake of Treasury bills at the weekly auction, with the Central Bank of Kenya (CBK) snubbing over Sh17 billion of the Sh43.47 billion bids.
This was against a CBK offer of Sh24 billion as the government accepted a total of Sh26.01 billion from investors.
The acceptance rate for the Treasury bills declined to 59.8 per cent from 76.7 per cent recorded the previous week.
“CBK in rejecting Sh17.46 billion at the auction has signalled a protracted lower yield environment at least for the shorter interest rates. Thus we expect investors to remain disciplined at the next auction,” said Churchill Ogutu, a macroeconomic and fixed income analyst at investment bank Genghis Capital on Friday.
The yield on the 91-day tenor remained unchanged at 7.642 per cent, while yields on the 182-day and 364-day tenors declined by 0.1 per cent to 8.770 per cent and 9.735 per cent, from 8.876 per cent and 9.825 per cent recorded the previous week.
The improved liquidity also saw the interbank rate decline to 3.4661 per cent.
Markets analysts anticipate a slightly subdued uptake of Treasury bills this week on the back of the ongoing primary bond sale that closes on September 18.
“We still expect current liquidity conditions to hold although the tax remittances and turn to a new CRR cycle may tighten liquidity,” said Mr Ogutu.
The 91-day tenor received bids worth Sh7.31 billion against an offer of Sh4 billion, which were accepted by CBK.
The 182-day tenor received bids worth Sh17.09 billion against an offer of Sh10 billion with CBK accepting Sh7.27 billion.
The 364-day tenor received bids worth Sh19.06 billion against an offer of Sh10 billion. CBK accepted Sh11.42 billion.
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