Kenya Fixed Income Weekly Update – 18th July 2025

1. Treasury Bills (T-Bills) Auction:
T-bills were oversubscribed for the first time in four weeks, with an overall subscription rate of 115.9%, up from 94.9% the previous week. Here’s how the demand spread out:

• 91-day paper: Subscription rate declined to 49.1% (Kshs 2.0 bn vs. Kshs 4.0 bn offered)
• 182-day paper: Slight drop to 76.2%
• 364-day paper: Strong investor interest, rising to 182.4% from 96.6%

The government accepted Kshs 24.1 bn out of Kshs 27.8 bn in total bids – an acceptance rate of 86.7%.

📊 T-Bill Yields (Mixed Performance):

• 91-day: ⬇️ 8.13% (-1.4 bps)
• 182-day: ⬇️ 8.43% (-0.9 bps)
• 364-day: ⬆️ 9.73% (+0.6 bps)

2. Liquidity & Interbank Market:

• Interbank rate ticked up slightly to 9.6% (⬆️ 0.8 bps), reflecting mild tightening.
• Interbank volumes dropped to Kshs 10.8 bn, down from Kshs 11.9 bn (▼ 9.8%)

3. Eurobonds Market:

• Yields on Kenya’s Eurobonds trended upward.
• The 13-year bond (2021) saw the sharpest spike: 10.1%, up by 24.6 bps.

4. Kenyan Shilling:

• The KES remained stable, depreciating marginally by 0.1 bps to close at Kshs 129.2/USD.
• YTD Performance: Appreciated by 4.9%, after a 17.6% gain in 2024.

5. Forex Reserves:

• Slight decline of 0.1%, holding steady at USD 11.2 bn – equivalent to 4.9 months of import cover, still above both the statutory (4.0 months) and EAC (4.5 months) thresholds.

6. Weekly Highlight: Fuel Price Adjustment (Effective 15th July – 14th August 2025)
EPRA announced increased pump prices for the month:

• Super Petrol: Kshs 186.3/L (⬆️ Kshs 9.0 / +5.1%)
• Diesel: Kshs 171.6/L (⬆️ Kshs 8.7 / +5.3%)
• Kerosene: Kshs 156.6/L (⬆️ Kshs 9.7 / +6.6%)

These hikes may impact inflationary pressures in the short term.

📌 Stay tuned for our weekly breakdowns covering money markets, bonds, currency trends, and macroeconomic insights.