Kenya’s domestic debt market is attracting unusually strong investor demand, with the latest Treasury bill auction drawing KSh100.43 billion in bids against a KSh 24 billion offer, the highest demand seen in seen CBK records.
- •The 364 day bill attracted KSh83.32 billion in bids, accounting for the bulk of demand, the 182 day bill received KSh15.16 billion, while the 91 day paper drew KSh1.95 billion.
- •The government accepted KSh41.42 billion from the sale, above the amount offered, as it refinanced KSh26.21 billion in maturing securities and raised about KSh15.21 billion in net new borrowing.
- •Central Bank data shows that the combined stock of Treasury bills and bonds recently crossed the KSh7 trillion mark.
Strong demand has also been evident in the Treasury bond market during the 2025/26 fiscal year. Auctions conducted to 16 February 2026 received KSh1.38 trillion in bids against KSh540 billion offered, allowing the government to raise KSh746.35 billion from the domestic market.
The largest demand during the fiscal year came in August 2025. A reopening of IFB1/2018/015 and IFB1/2018/019 infrastructure bonds on 18 August received KSh323.4 billion in bids against a KSh90 billion offer. A subsequent tap sale of the same issue on 25 August attracted KSh207.5 billion and raised KSh179.8 billion. The February 16 auction, which reopened FXD3/2019/015 and FXD1/2018/025 bonds, also recorded strong demand with KSh213.74 billion in bids for a KSh100 billion offer.
Oversubscription has been common across several bond auctions this fiscal year. Sales in July, September, October and November all drew bids well above the amounts offered, reflecting continued appetite from institutional investors.
The surge in demand reflects large volumes of liquidity within Kenya’s financial system. Banks, pension funds and money market funds continue to allocate significant balances into government securities, which remain among the lowest risk assets in the domestic market. At the same time, large volumes of maturing domestic debt are being rolled into new issues, reinforcing demand across the Treasury bill and bond markets.
