Kenya Bond Market Update: 19 September 2024

Published on
September 19, 2024
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Fed Day

 

The Federal Reserve on Wednesday enacted its first interest rate cut since the early days of the COVID pandemic, slicing half a percentage point (50bps) off benchmark rates in an effort to head off a slowdown in the labor market. The decision lowers the federal funds rate to a range between 4.75%-5%. Attached is the Fed’s Statement for more information behind this decision. The results of the re-opened FXD1/2024/10Yr and FXD1/2016/20Yr are attached and below is a quick summary:

  • FXD1/2024/10Yr: average of 16.8696% on the back of KES 11.565Bn in bids accepted from a total of KES 13.396Bn in bids received.
  • FXD1/2016/20Yr: average of 17.2854% on the back of KES 7.711Bn in bids accepted from a total of KES 9.246Bn in bids received.
  • Subscription: An under-subscription as the Central Bank received KES 22.642Bn in bids, accepting KES 19.276Bn. This was short of the KES 30Bn target set for this auction.

For the rest of your trades today, below is a snapshot of what is at play within the secondary market for your consideration. Happy hunting!
Below are the two-way quotes for the benchmark tenors:
 
Indicative Two-Way Quotes - Benchmark Tenors
Benchmark Tenor Bid (%) Offer (%) Mov (t-t0)%
1Yr 16.80 16.50 0.00
2Yr 17.50 17.00 0.00
5yr 18.00 17.70 0.00
10yr 17.00 16.50 0.00
15yr 16.50 16.00 0.00
20yr 16.50 16.00 0.00
25yr 16.50 16.00 0.00
Below are details of the two-way quotes for the infrastructure bonds and the key rates:
 
Indicative Two-Way Quotes - IFB Series
IFB series Maturity Bid (%) Offer (%) Mov (t-t0)%
IFB1/2017/7 (IFB13) Nov-24 15.50 15.00 0.00
IFB1/2016/9 (IFB10) May-25 16.00 15.00 0.00
IFB1/2015/12 (IFB8) Mar-27 15.50 15.00 0.00
IFB1/2017/12 (IFB12) Feb-29 16.00 15.00 0.00
IFB1/2016/15 (IFB11) Oct-31 16.50 16.00 0.00
IFB1/2018/15 (IFB14) Jan-33 16.50 16.00 0.00
IFB1/2018/20 (IFB15) Oct-38 16.50 16.00 0.00
IFB1/2019/25 (IFB16) Feb-44 16.50 16.00 0.00
IFB1/2019/16 (IFB17) Oct-35 16.50 16.20 0.00
IFB1/2020/9 (IFB18) Apr-29 16.50 16.00 0.00
IFB1/2020/6 (IFB19) May-26 16.50 16.00 0.00
IFB1/2020/11 (IFB20) Aug-31 17.00 16.00 0.00
IFB1/2021/16 (IFB21) Jan-37 17.00 16.50 0.00
IFB1/2021/18 (IFB22) Mar-39 17.10 16.50 0.00
IFB1/2021/21 (IFB23) Aug-42 17.20 16.50 0.00
IFB1/2022/19 (IFB24) Jan-41 17.10 16.50 0.00
IFB1/2022/18 (IFB25) May-40 17.00 16.50 0.00
IFB1/2022/14 (IFB26) Oct-36 17.00 16.50 0.00
IFB1/2022/6 (IFB27) Nov-28 16.50 16.00 0.00
IFB1/2023/17 (IFB28) Feb-40 16.80 16.60 0.15
IFB1/2023/7 (IFB29) Jun-30 16.90 16.30 0.00
IFB1/2023/6.5 (IFB30) May-30 16.70 16.40 0.15
IFB1/2024/8.5 (IFB31) Aug-32 16.80 16.60 0.10
 
 
Key  Interest Rates   Mov (bps)
O/N Interbank 12.6756% -0.69
91 Day T-bill 15.7502% -1.75
182 Day T-bill 16.6248% -0.07
364 Day T-bill 16.8168% -0.60
Central Bank Rate (CBR) 12.75% -25.00
Inflation 4.40% 10.00
Attached are the bond positions available today, the Federal Reserve Statement and the FXD1/2024/10Yr & FXD1/2016/20Yr Auction Results.
Bond Positions
Federal Reserve Statement
FXD1/2024/10Yr & FXD1/2016/20Yr Auction Results
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