T-Bills In The Red As Kenyans Anxiously Wait For The New President

T-bills remained undersubscribed, with the overall subscription rate coming in at 72.4 percent, up from the 48.3 percent recorded the previous week. This is according to stats from Cytonn.

The undersubscription was partly attributable to the tightened liquidity in the money market with the average interbank rate increasing to 5.6 percent, from 5.3 percent recorded the previous week.

Investors’ preference for the shorter 91-day paper persisted, with the paper receiving bids worth 12.0 billion shillings against the offered 4.0 billion shillings, translating to a subscription rate of 299.8 percent, up from the 186.9 percent recorded the previous week.

The subscription rate for the 182-day paper increased to 39.3 percent from 20.5 percent recorded the previous week while that of the 364-day paper declined to 14.5 percent, from 20.6 percent recorded the previous week.

The yields on the government papers continued to increase, with the yields on the 364-day, 182-day, and 91-day papers increasing by 0.2 bps, 3.3 bps, and 9.2 bps to 9.9, 9.4, and 8.6 percent, respectively.

The government accepted a total of 17.3 billion shillings worth of bids out of the 17.4 billion shillings worth of bids received, translating to an acceptance rate of 99.7 shillings.

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During the week, the yields on all Eurobonds were on a downward trajectory, an indication of easing risk concerns over the economy by investors.

The yields on the 7-year Eurobond issued in 2019 and the 10-year Eurobond issued in 2014 recorded the highest decline having declined by 3.0 percentage points each to 13.0 and 12.2 percent, from 16.0 and 15.2 percent, respectively, recording the previous week.

During the week, liquidity in the money markets tightened, with the average interbank rate increasing to 5.6 percent, from 5.3 percent recorded the previous week, partly attributable to tax remittances that offset government payments.

The average interbank volumes traded increased by 4.8 percent to Kshs 25.9 bn, from Kshs 25.0 bn recorded the previous week. 

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