Kenya 91 day T bill yield falls to 7.223pc

August 30, 2009

, NAIROBI, Kenya, Aug 30 – The Government securities market posted a 31.2 percent performance rate during the 91-day Treasury Bills auction of August 27.

The average 91-day Treasury Bills rate was 7.223 percent during the week’s auction where the Government has offered Treasury Bills worth Sh5 billion for sale. It however received bids totalling Sh1.6 billion.

"The Government accepted all the Treasury Bills bids totalling Sh1.6 billion, of which Sh1.1 billion were in competitive bids. The proceeds of the auction were partly to be used to meet the cost of rolling over Treasury bills maturities amounting to Sh3.3 billion in the week and provided a net repayment of Sh1.8 billion," indicated the Central Bank of Kenya (CBK) weekly bulletin.

The report said the 91-day Treasury Bills rate declined by 3.8 basis points, from 7.261 percent in the previous auction of the same security to 7.223 percent during this week’s auction.

Consequently, the 12-weeks moving average for the 91-day Treasury Bills rate declined from 7.337 percent to 7.325 percent.

According to the bulletin, the shilling strengthened against major international currencies during the week ending August 28.  Against the US dollar, it was exchanging at Sh76.26 compared with Sh76.38 in the previous week.

Official usable foreign exchange reserves held by the Central Bank increased marginally to stand at US$3,157 million while those held by the commercial banks, predominantly for use by the private sector to meet external financial obligations, decreased from US$2,177 million as at end July 2008 to US$1,614 million as at end July 2009.

Commercial banks maintained an average of Sh3 billion in their clearing accounts at the Central Bank in the week to August 29, 2009.

Market liquidity continued to be below the desired level despite efforts by the CBK to inject Sh15.0 billion through reverse repo securities.

The bond market trading improved at with bonds worth Sh2.7 billion traded compared with Sh1.1 billion traded in the previous week. Performance at the equities market however declined.





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