Inter-bank Rate Ups 0.3 Percentage Points To 6.6 Percent

As Kenyans prepare to say goodbye to 2019 and ushering in 2020, the average interbank rate, according to Cytonn Investment increased by 0.3 percentage points during sessions last week.

Last week, the average interbank rate increased to 6.6 percent from 6.3 percent recorded the previous week.

The increase in the interbank rate, according to Cytonn, was as a result of tightened liquidity in the money markets mainly driven by banks trading cautiously in the interbank market in order to meet their CRR cycle requirements for the period ending December 15^th, 2019.

This saw commercial banks excess reserves come in at 13.1 billion shillings in relation to the 5.25 percent cash reserves requirement (CRR).

The average interbank volumes increased by 24.3 percent to 29.3 billion shillings from 23.6 billion shillings recorded the previous week.

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Kenya Eurobonds

According to Reuters, the yield on the 10-year Eurobond issued in June 2014, decreased by 0.4 percentage points to 4.9 percent from 5.3 percent as recorded in the previous week.

Eurobond yields were on the decline as a result of the Fitch’s credit Rating released earlier during the week, affirming that Kenya’s Long-Term Foreign-Currency Issuer Default Rating was at B+ with a stable outlook.

During the week, the yields on the 10-year Eurobond and the 30-year Eurobond both decreased by 0.5 percent points and 0.3 percentage points to 6.1 and 7.8 percent from 6.6 and 8.1 percent respectively.

During the week, the yield on the 7-year Eurobond decreased by 0.4 percentage points to 5.9 percent from 6.3 percent recorded the previous week, while the yield on the 12-year Eurobond decreased by 0.3 percentage points to 7.1 percent from 7.4 percent recorded the previous week.

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