During the week, T-bills remained oversubscribed, but the overall subscription rate dropped; coming in at 152.4 percent, from 162.0 percent recorded the previous week.
The demand for the 364-day paper persisted, as it recorded the highest bids worth 23.8 billion shillings against the offered 10.0 billion shillings, translating to a subscription rate of 238.2 percent, a decrease from the 241.3 percent recorded the previous week.
Investors’ continued interest in the 364-day paper is mainly attributable to the paper’s attractive return of 9.2 percent which is higher than the rate being offered by most banks.
The subscription rate for the 182-day paper increased to 103.1 percent, from 101.1 percent recorded the previous week, receiving bids worth 10.3 billion shillings against the 10.0 billion shillings offered.
The subscription rate for the 91-day paper declined to 61.2 percent, from 116.1 percent recorded the previous week, with the paper receiving bids worth 2.4 billion shillings against the offered amounts of 4.0 billion shillings.
Read More: T-Bill Subscription Still Below 100% As GoK Receives Ksh 21.7 Bn In Bids
The yields on all three papers declined; with the 91-day, 182-day, and 364-day paper declining by 1.6 bps, 8.8 bps, and 12.8 bps, to 7.1, 7.9, and 9.2 percent, respectively.
The government continued to reject expensive bids, accepting 20.6 billion shillings out of the 36.6 billion shillings worth of bids received, translating to an acceptance rate of 56.3 percent.
In the money markets, 3-month bank placements ended the week at 7.9 percent (based on what we have been offered by various banks), while the yield on the 91-day T-bill declined marginally by 1.6 bps to 7.1 percent.
The average yield of the Top 5 Money Market Funds remained unchanged at 10.0 percent, similar to what was recorded the previous week.
The yield on the Cytonn Money Market Fund remained unchanged at 10.6 percent, similar to what was recorded the previous week.
Read More: T-Bill Subscription Still In The Red, Investors Rush For 364-Day Paper
Liquidity in the money market tightened, with the average interbank rate increasing marginally to 5.0 percent, from 4.9 percent recorded the previous week, partly attributable to tax remittances which partly offset Government payments.
The average interbank volumes declined by 3.4 percent to 9.2 billion shillings, from 9.5 billion shillings recorded the previous week.