Flattening Friday – The T-bill auction was oversubscribed this week with the market continuing to heavily favour the shortest T-bill, the 91D T-bill. The CBK secured KES 32.135Bn, with both the 91D and 182D rates rising significantly quicker than the 364D T-bill. This has resulted in the yield curve for the T-bills flattening as the difference in rates across the bills decreases. Attached are the results for your perusal.
The CBK has on offer the IFB1/2023/7Yr as they seek KES 60bn from its sale. Below are my expectations for how the auction will play out:
· Bids: Bidding range of 14.90% - 15.20%
· Average: 14.90% – 14.99%
· Subscription: Oversubscription as a result of improved levels of liquidity in the market
· The prospectus for this auction is attached with all the required information to facilitate your bidding process.
For your trading activities today, below is a snapshot of what is at play within the secondary market for your consideration. Happy hunting!
Below are the two-way quotes for the benchmark tenors, two-way quotes for the infrastructure bonds and the key rates:
Attached are the bond positions available today, T-bill auction results for this week and the IFB1/2023/7Yr bond prospectus.