The subscription rate for Treasury bills rose last week on improved liquidity in the money market, reversing a two week downward trend.
The liquidity in the market had tightened in the last two weeks of June due to remittance of tax holdings by commercial banks to CBK at the end of the fiscal year, as well as dividend payments by various firms, including banks.
The subscription rate for the three tenors of T-bills stood at 116.25 per cent from 72.9 per cent recorded the previous week, with a target of Sh24 billion in total.
The 182-day paper was the most popular among investors, attracting bids worth Sh15 billion against a target of Sh10 billion.
The 91-day and 364-day papers brought bids of Sh4.2 billion and Sh8.4 billion respectively.
Money market analysts had predicted improved appetite for the primary securities auction, saying although liquidity remains subdued, the end of the tax remittance cycle coupled with new government payments as the new fiscal year kicks in would free up funds for investors.
Credit: Business Daily