Secondary Market Turnover up to 14.75 Billion Shillings

Secondary market turnover increased 28.18 percent on a week-to-week basis to settle at 14.75 billion shillings.

The 2018 infrastructure bond (IFB) continued its stellar run in the course of the week, contributing 29.82 percent of the total turnover.

The top five traded bonds were dominated by short-end maturities as banks sought the home for liquidity.

Sell-Buy back transactions in the week were mainly on IFB1/2015/12Yr which accounted for 70.70 percent of the total 621.90 million shillings turnover.

The IMF Executive Board approved Kenya’s request for an extension, till mid-September, of the Stand-By Arrangement to allow additional time to complete the outstanding reviews.

No prize guessing the origin of the urgency (in regards to a possible review of the interest rate controls) that has gathered momentum from Treasury in the recent past.

Treasury intends to achieve a significant modification of interest rate controls to avoid their impact on credit to the private sector, monetary policy effectiveness, and financial stability.

“With the backing of hard statistics (pointing to its negative impact) coupled with a more accommodative Legislature (post elections), we don’t envision a lengthy legislative process in the modification of the interest rate cap law,”

In addition, an interest rate corridor around the CBR is also in the pipeline to strengthen the monetary policy transmission channel.