Government disbursements enhanced liquidity which in turn upheld healthy Treasury bill subscriptions at the auction last week.

Treasury collected Sh27.45 billion, Sh3.45 billion more than the target provided by investors. Investors had bid Sh33.72 billion which was a demand of 140.53 percent.

With regards to the 364-day paper, the Central Bank of Kenya (CBK) rejected Sh5.88 billion competitive bids in order to control aggressive bidding.

“Weighted average interest rate of accepted bids was 8.033 percent (91-day paper), 10.403 percent (182-day), and 11.154 percent (364-day),” CBK stated.

Market analysts said the primary bond auction that is in progress did not daunt the Treasury bill subscription, an indication of increased market liquidity.

In the auction, investors bid Sh4.67 billion on the 3-month paper against a Sh4 billion target. The Treasury accepted Sh4.28 billion putting the subscription rate at 116.84 percent. Furthermore, the government absorbed Sh11.21 billion on 6-month paper bids against a Sh10 billion target. The subscription rate was at 112.19 percent. The government also absorbed Sh11.95 billion on the one-year tenor from bids worth Sh17.83 billion. The CBK tenor offer was Sh10 billion. The subscription rate was 178.34 percent.

 

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