Kenya’s most recent Treasury bond tap sale—FXD1/2020/015—recorded an impressive investor turnout, with total bids received surpassing the advertised amount by 32%. The Central Bank of Kenya (CBK) had offered KES 10 billion in the tap sale dated 14 April 2025, but bids worth KES 13.24 billion were received, reflecting robust demand for government securities.
Out of the bids submitted, CBK accepted KES 12.59 billion, representing an acceptance rate of approximately 95.1%. The high subscription is a clear indication of investor confidence in government debt instruments, particularly in a market environment characterized by moderate inflation and an accommodative monetary policy stance.
The Treasury bond, FXD1/2020/015, carries a coupon rate of 12.756% and was issued at an adjusted average price of KES 97.0749 per KES 100. The allocated average rate for accepted bids stood at 13.662%, slightly above the coupon, reflecting the prevailing yield environment and investor appetite for better returns.
Recent Treasury Bonds and Bills Trends
This tap sale follows a series of Treasury bill auctions that have shown shifting investor preferences. Investors have increasingly favored shorter-term securities—primarily the 91-day T-bill—owing to uncertainty around long-term interest rates. In recent weeks, the 91-day T-bill has seen oversubscription, while the 182-day and 364-day tenors have recorded modest performances.
Yields across these tenors have adjusted in response. The 91-day has seen slight drops in yield, reflecting aggressive bidding, while the 364-day tenor experienced a marginal decline, suggesting cautious optimism about long-term economic stability.
The Trading Room Analyst Rennie Odek, “Investors should brace for continued high demand for government securities (Treasury bonds), especially if inflation remains manageable and interest rates stay attractive and stock markets continue to show volatility.”
Furthermore, as fiscal pressures mount and the government looks to fund infrastructure and development projects, more tap sales and reopenings of existing treasury bonds could be expected, offering additional opportunities for investors to lock in favorable returns.
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