Sharp Daily
No Result
View All Result
Wednesday, June 4, 2025
  • Home
  • News
    • Politics
  • Business
    • Banking
  • Investments
  • Technology
  • Startups
  • Real Estate
  • Features
  • Appointments
  • About Us
    • Meet The Team
Sharp Daily
  • Home
  • News
    • Politics
  • Business
    • Banking
  • Investments
  • Technology
  • Startups
  • Real Estate
  • Features
  • Appointments
  • About Us
    • Meet The Team
No Result
View All Result
Sharp Daily
No Result
View All Result
Home Investments

Kenyans shun government bond as subscription rate plummets to 2.4%

Brian Murimi by Brian Murimi
July 5, 2024
in Investments
Reading Time: 1 min read

Kenyan investors have overwhelmingly rejected the latest government bond offering, with the subscription rate falling to a mere 2.4%.

The Central Bank of Kenya (CBK) reported that the tap sale issue for the FXD1/2023/002 bond received bids worth only KES 0.488 billion against the offered KES 20.0 billion.

The 1.2-year bond, carrying a fixed coupon rate of 17.0%, failed to attract significant interest despite offering a real return of 12.5% based on the current inflation rate of 4.6%.

The government accepted nearly all bids, with an acceptance rate of 99.8%, totaling KES 0.486 billion.

RELATEDPOSTS

Treasury admits KES 73 billion budget error, seeks parliament’s approval for correction

March 7, 2025

Treasury proposes taking over CBK’s role in managing government securities

January 23, 2025

This poor performance contrasts sharply with the Treasury bill market, which saw its first oversubscription in four weeks. The overall subscription rate for T-bills reached 124.4%, a significant improvement from the previous week’s 32.0% undersubscription.

Investors showed a strong preference for the 91-day T-bill, which was oversubscribed by 370.1%. The 182-day and 364-day papers also saw increased interest, with subscription rates of 94.2% and 56.3% respectively.

The government accepted KES 27.9 billion out of the KES 29.9 billion bids received for T-bills, representing an acceptance rate of 93.4%. Yields on all T-bill tenors increased slightly, with the 364-day paper rising to 16.83%, the 182-day to 16.80%, and the 91-day to 15.99%.

The stark difference in performance between the bond and T-bills suggests that investors are currently favoring shorter-term government securities, possibly due to uncertainties in the long-term economic outlook or expectations of further interest rate changes.

This development poses challenges for the Kenyan government’s debt management strategy, as it may need to reassess its approach to longer-term borrowing in the domestic market. The low subscription rate for the bond could potentially lead to higher borrowing costs in future issuances if the trend continues.

Previous Post

Government halts public sector hiring in bid to tame wage bill

Next Post

Labour sweeps to power as Keir Starmer replaces Sunak as UK Prime Minister

Brian Murimi

Brian Murimi

Brian Murimi is a journalist with major interests in covering tech, corporates, startups and business news. When he's not writing, you can find him gaming, watching football or sipping a nice cup of tea. Send tips via bireri@thesharpdaily.com

Related Posts

Investments

Navigating the money market and fixed income funds landscape

June 3, 2025
Investments

Foreign influence in Kenya’s credit crisis

May 28, 2025
Investments

SACCO’s at the heart of rural financial inclusion in Kenya

May 22, 2025
Investments

Real yields vs. nominal yields on Kenya’s government bonds

May 21, 2025
Investments

Knight Frank: Kenya’s wealthy swap mansions for market moves

May 19, 2025
Investments

All you need to know about the Cytonn Money Market Fund

May 16, 2025

LATEST STORIES

Economic reforms are costly

June 3, 2025

Cytonn Income Drawdown Fund (CIDDF)

June 3, 2025

Navigating the money market and fixed income funds landscape

June 3, 2025

Best investments for Kenyan seniors: Secure, predictable & low-risk

May 30, 2025

Why June is the Secret Sweet Spot for Travel

May 30, 2025

Strategies to elevate more women to corporate leadership

May 30, 2025

Tap on Kenya’s 2025 tech revolution

May 30, 2025

How CURBS supports employers and employees

May 30, 2025
  • About Us
  • Meet The Team
  • Careers
  • Privacy Policy
  • Terms and Conditions
Email us: editor@thesharpdaily.com

Sharp Daily © 2024

No Result
View All Result
  • Home
  • News
    • Politics
  • Business
    • Banking
  • Investments
  • Technology
  • Startups
  • Real Estate
  • Features
  • Appointments
  • About Us
    • Meet The Team

Sharp Daily © 2024