Interest rates on short-term government securities in Kenya edged up for the second week after maintaining a downward trend in past weeks.The upward turn is expected to make investors, who had fled the debt market, troop back as they seek to cash in on rising interest rates. Yields for both 91-day and 182-day Treasury bills increased in this week’s auction by at least 0.4 per cent as Central Bank of Kenya borrowed more from investors. Weighted average yield for the indicative 91-day Treasury bill increased to 8.09 percent in the auction dated October 1, up from 7.64 per cent the previous week.“The market weighted average rate was 8.09 per cent. The weighted average rate of accepted bids which will be applied for noncompetitive bids was 8.09 per cent up from 7.64 per cent recorded in the previous auction,” said CBK’s director of financial markets department Gerald Nyaoma in a brief on the auction.This week’s rise in 91-day bill interest rates is 4 times the increase in the auction dated Sept. 24, where interest rates started to take a positive turn.Then, the rates increased by 0.13 per cent from 7.51 in the previous week’s auction to 7.64 per cent.The market weighted average rate for the auction was 9.39 per cent, according to Central Bank.Similarly, interest rate for 182-day Treasury bill in this week’s auction rose by 0.62 percent, from 9.26 per cent to 9.88 percent. “The market weighted average rate was 10.26 per cent while the weighted average rate of accepted bids, which will be applied for noncompetitive bids was 9.88 percent up from 9.26 percent in previous auction,” said Nyaoma.Xinhua
