Treasury bills subscription rate slightly improved in November to an average of 80.01 per cent from 51.29 per cent recorded in October.
The Treasury accepted Sh73.7 billion of the Sh76.6 billion worth of bids received, against a target of Sh96 billion by Central Bank of Kenya (CBK).
“Liquidity in the money market, even with improvement in November, remained tight with Treasury bills auctions recording an under-subscription,” said Cytonn Investments’ analysts.
In November, the average subscription rate for the 91, 182, and 364-day papers came in at 134.1 per cent, 56.7 per cent and 81.5 per cent respectively.
The yields for the 91, 182, and 364-days papers were at eight per cent, 10.4 per cent and 11 per cent respectively.
The 91-days paper has been trading below its five-year average of 9.2 per cent. The lower yield on the three-month paper is mainly attributed to the low-interest rate environment which has been experienced since the beginning of the year.
Market analysts expect this to continue in the short-term, given the discipline of the CBK in stabilising interest rates at the auction by rejecting aggressive bids that are priced above market rate, for both Treasury bills and bonds.