The Monetary Policy Committee (MPC) of the CBK met yesterday and decided to retain the Central Bank Rate (CBR) at 10.50%. Together with this decision, the MPC announced the following measures:
Net domestic borrowing target reduced to KES 316Bn from KES 586.5Bn
Interbank rate to closely track the CBR. This will be done by introducing an interest rate corridor around the CBR set at +/-250bps. This should enhance monetary policy transmission by giving the CBR more relevance.
Improved access to the Discount Window by reducing the applicable interest rate from the current 600bps above CBR to 400bps above CBR.
There was another significant drop of 266bps in the interbank rate in yesterday’s trading session. 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:
Indicative Two-Way Quotes - Benchmark Tenors
Benchmark Tenor
Bid (%)
Offer (%)
Mov (t-t0)%
1Yr
13.50
13.00
0.00
2Yr
16.00
15.00
0.00
5yr
17.20
16.90
0.00
10yr
17.00
16.50
0.00
15yr
17.00
16.00
0.00
20yr
17.00
16.00
0.00
25yr
17.00
16.00
0.00
Below are details of the two-way quotes for the infrastructure bonds and the key rates:
Indicative Two-Way Quotes - IFB Series
IFB series
Maturity
Bid (%)
Offer (%)
Mov (t-t0)%
IFB1/2017/7 (IFB13)
Nov-24
13.50
12.75
0.00
IFB1/2016/9 (IFB10)
May-25
13.50
13.00
0.00
IFB1/2015/12 (IFB8)
Mar-27
14.00
13.00
0.00
IFB1/2017/12 (IFB12)
Feb-29
15.00
14.00
0.00
IFB1/2016/15 (IFB11)
Oct-31
15.00
14.00
0.00
IFB1/2018/15 (IFB14)
Jan-33
15.00
14.50
0.00
IFB1/2018/20 (IFB15)
Oct-38
16.00
15.00
0.00
IFB1/2019/25 (IFB16)
Feb-44
16.50
15.00
0.00
IFB1/2019/16 (IFB17)
Oct-35
16.00
15.00
0.00
IFB1/2020/9 (IFB18)
Apr-29
14.50
14.00
0.00
IFB1/2020/6 (IFB19)
May-26
13.00
12.00
0.00
IFB1/2020/11 (IFB20)
Aug-31
15.00
14.75
0.00
IFB1/2021/16 (IFB21)
Jan-37
15.75
15.00
0.00
IFB1/2021/18 (IFB22)
Mar-39
15.70
15.00
0.00
IFB1/2021/21 (IFB23)
Aug-42
16.50
15.30
0.00
IFB1/2022/19 (IFB24)
Jan-41
15.50
15.00
0.00
IFB1/2022/18 (IFB25)
May-40
15.70
15.50
0.00
IFB1/2022/14 (IFB26)
Oct-36
15.50
15.00
0.00
IFB1/2022/6 (IFB27)
Nov-28
13.30
13.20
0.00
IFB1/2023/17 (IFB28)
Feb-40
15.70
15.00
0.00
IFB1/2023/7 (IFB29)
Jun-30
16.00
15.60
0.00
Key Interest Rates
Mov (bps)
O/N Interbank
10.3855%
-266.51
91 Day T-bill
12.6855%
45.25
182 Day T-bill
12.5579%
23.59
364 Day T-bill
13.1072%
39.92
Central Bank Rate (CBR)
10.50%
100.00
Inflation
7.30%
-70.00
Attached are the bond positions available today, the MPC Statement and the bond auction prospectus for August 2023.
