Kenya’s reforms to increase liquidity

Kenya plans to offer five Treasury bonds for sale in the first quarter of its 2016/17 (July-June) fiscal year, with tenors ranging from two years to 15 years, the National Treasury said on Monday.

The finance ministry said it had shifted to publishing a quarterly rather than monthly issuance calendar as part of reforms meant to increase liquidity, deepen the bond market and reduce interest rate spreads.

In the past decade, the East African nation has attracted more investors into its debt market, including foreigners hunting higher yields.

But it has been criticised for lack of transparency and for bungling the timing of some debt sales, causing interest rates to spike as they did in the second half of 2015.

The Treasury said the central bank aims to sell an unspecified amount of 10-year bonds in August and two-year and 15-year bonds in September. It sold five-year and 20-year bonds in July.

The central bank will also sell 91-day, 182-day and 364-day Treasury bills on a weekly basis.