The Central Bank of Kenya (CBK) treasury bills auction for the first week of 2026 recorded strong subscription across all tenors, albeit lower than the last auction of 2025.
The 91-day paper, which offered a yield of 7.73% received bids amounting to KES 4.34 billion against a targeted amount of KES 4 billion, translating to a performance rate of 108.5% and an oversubscription of 8.5%, down from an oversubscription of 58% in last week’s auction.
The 182-day paper, which targeted KES 10 billion was undersubscribed despite the yields remaining unchanged from the previous auction. The paper received bids amounting to KES 9.61 billion, representing a performance rate of 96.1%, down from a performance rate of 112.9% in the previous auction.
The 364-day paper posted a performance rate of 173.2% after receiving bids amounting KES 17.3 billion against KES 10 billion targeted by the CBK. The paper’s oversubscription highlights investors’ strategy of taking advantage of the current interest rates as further cuts to the Central Bank Rate (CBR) are anticipated in the coming months.
Out of the KES 31.27 billion of bids received, the CBK accepted KES 26.16 billion from an offer of KES 24 billion. The bank accepted KES 4.32 billion from the 91-day paper, KES 9.61 billion from the 182-day paper, and KES 12.24 billion from the 364-day paper.
CBK interest rate cuts lower T-Bills yields
Yields on treasury bills have declined compared to a similar period the previous year. The decline is attributed to a reduction in the CBR. The CBK cut the benchmark rate by a cumulative 225 bps in 6 consecutive Monetary Policy Committee (MPC) meetings to 9.00% in December 2025, from 11.25% in January 2025. The lower CBR is expected to anchor lower rates across the board in 2026.
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