15 May 2017

Kenya: Treasury Bills Oversubscribed As Demand Remains High

The 91-day and 182-day Treasury bills were oversubscribed by 198.5 per cent and 96 per cent respectively underscoring the ample liquidity in the market.

The Central Bank of Kenya (CBK) had offered Sh4 billion and Sh10 billion for the 91-day and 182-day papers, respectively.

The 91-day paper received bids worth Sh11.94 billion while the 182-day paper attracted Sh19.6 billion. The Treasury only accepted Sh6.7 billion from the 91-day bids, and Sh12.5 billion from the 182-day offer.

During the previous week auction, the 182-day paper, which had just resumed sale after being out of the market for eight weeks, attracted bids worth Sh25.37 billion with the Treasury only accepting bids of Sh20.4 billion at a weighted average rate of 10.475 per cent from the paper.

The weighted average rate of accepted bids last week was 8.726 per cent (91-day) and 10.407 per cent (182-day).

Market analyst at Genghis Capital said they expect demand to remain high on the shorter dated paper, with demand on the longer paper expected to slow down due to the upcoming 7-year tenor bond.

"The 182-day Treasury bill saw the heaviest interest receiving Sh19.6 billion in bids. We expect this to be the trend in the short term as investors seek to balance their exposure which had been skewed towards the 91-day and 364-day Treasury bill due to the suspension of the 182-day Treasury bill for a period," said Genghis.

They said the auction saw little movement in the rates with conservative bidding across the board.

CBK overall received Sh42.3 billion in bids accepting only Sh29.76 billion.

The 364-day paper attracted Sh10.75 billion out of the targeted Sh10 billion.

CBK in its weekly statistical bulletin said the money market was relatively liquid during the week.

Kenya

Opposition MP Urges President Magufuli to Emulate Kenyatta

Arusha Urban MP (Chadema) Godbless Lema has called on President John Magufuli to borrow a leaf from Kenyan counterpart… Read more »

Copyright © 2017 The Nation. All rights reserved. Distributed by AllAfrica Global Media (allAfrica.com). To contact the copyright holder directly for corrections — or for permission to republish or make other authorized use of this material, click here.

AllAfrica publishes around 900 reports a day from more than 150 news organizations and over 500 other institutions and individuals, representing a diversity of positions on every topic. We publish news and views ranging from vigorous opponents of governments to government publications and spokespersons. Publishers named above each report are responsible for their own content, which AllAfrica does not have the legal right to edit or correct.

Articles and commentaries that identify allAfrica.com as the publisher are produced or commissioned by AllAfrica. To address comments or complaints, please Contact us.