Friday Forecasts
Next week Tuesday, the sale-period of this month’s bond auction comes to a close. To assist in your decision making, below are my expectations for the two bonds being re-opened:
- FXD4/2019/10Yr (8.0 years): average to come in between 12.50% - 12.60%.
- FXD1/2018/20Yr (16.4 years): average to come in between 13.15% - 13.25%.
The CBK has stated that their target is KES 40Bn for this auction, but they have also gone above beyond their stated targets in previous auctions. Market players are poised to aggressively push for higher rates with this auction given the slow-down in activity in the secondary market, and the perceived over supply of papers with similar maturities to these bonds being re-opened. This auction will therefore be a big test in CBK’s resolve to mitigate the market’s push for higher rates.
The T-bill auctions results from this week have been attached for your perusal.
Below is a snapshot of the secondary bond space to assist you with your trading activities today. Happy hunting and a lovely weekend ahead!
|
|
| Indicative Two-Way Quotes - Benchmark Tenors |
| Benchmark Tenor |
Bid (%) |
Offer (%) |
Mov (t-t0)% |
| 1Yr |
9.20 |
8.80 |
0.00 |
| 2Yr |
9.90 |
9.70 |
0.00 |
| 5yr |
11.35 |
11.25 |
0.00 |
| 10yr |
12.50 |
12.20 |
0.00 |
| 15yr |
13.00 |
12.80 |
0.00 |
| 20yr |
13.50 |
13.30 |
0.00 |
| 25yr |
13.75 |
13.65 |
0.00 |
|
|
| Indicative Two-Way Quotes - IFB Series |
| IFB series |
Maturity |
Bid (%) |
Offer (%) |
Mov (t-t0)% |
| IFB1/2017/7
(IFB13)
|
Nov-24 |
9.90 |
9.50 |
0.00 |
IFB1/2016/9
(IFB10) |
May-25 |
10.00 |
9.60 |
0.00 |
IFB1/2015/12
(IFB8) |
Mar-27 |
10.00 |
9.35 |
0.00 |
IFB1/2017/12
(IFB12) |
Feb-29 |
10.80 |
10.60 |
0.00 |
IFB1/2016/15
(IFB11) |
Oct-31 |
11.40 |
11.20 |
0.00 |
IFB1/2018/15
(IFB14) |
Jan-33 |
11.70 |
11.50 |
0.00 |
XIFB1/2018/20
(IFB15) |
Oct-38 |
12.00 |
11.80 |
0.00 |
IFB1/2019/25
(IFB16) |
Feb-44 |
12.50 |
12.15 |
0.00 |
IFB1/2019/16
(IFB17) |
Oct-35 |
12.35 |
12.10 |
0.00 |
IFB1/2020/9
(IFB18) |
Apr-29 |
11.20 |
11.00 |
0.00 |
IFB1/2020/6
(IFB19) |
May-26 |
10.00 |
9.70 |
0.00 |
IFB1/2020/11
(IFB20) |
Aug-31 |
11.70 |
11.60 |
0.02 |
IFB1/2021/16
(IFB21) |
Jan-37 |
12.50 |
12.25 |
0.07 |
IFB1/2021/18
(IFB22) |
Mar-39 |
12.50 |
12.25 |
0.05 |
IFB1/2021/21
(IFB23) |
Aug-42 |
12.60 |
12.53 |
0.00 |
|
|
| Key Interest Rates |
|
Mov (bps) |
| O/N Interbank |
5.2337% |
0.33 |
| 91 Day T-bill |
7.232% |
11.80 |
| 182 Day T-bill |
7.854% |
10.70 |
| 364 Day T-bill |
9.016% |
17.60 |
| Inflation |
5.80% |
-65.00 |
|
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