The government raised Ksh25.9 billion in its year-end Treasury Bills auction held on December 31, 2025, exceeding the advertised amount of Ksh24.0 billion. The auction performance of 108 per cent shows strong investor demand, with both individual and institutional investors taking part.

The Central Bank of Kenya (CBK) revealed the details on Friday, January 2, 2026, in its Weekly Bulletin outlining recent monetary and financial developments.

“The Treasury bill auction of December 31 received bids totalling Ksh25.9 billion against an advertised amount of Ksh24.0 billion, representing a performance of 108.0 per cent. Interest rate on the 91-day and 182-day Treasury bills remained stable while interest rates on the 364-day Treasury bill declined marginally,” the Central Bank of Kenya stated.

The auction offered three types of bills: Ksh4 billion in 91-day bills, Ksh10 billion in 182-day bills, and Ksh10 billion in 364-day bills. Interest rates on the shorter 91-day and 182-day bills remained stable, while the rate on the one-year 364-day bill fell slightly. The slight decline in the 364-day rate reflects steady confidence in government debt amid stable market conditions.

Investors submitted bids electronically through the DhowCSD and Treasury Mobile Direct platforms. Non-competitive bids, where investors accept the average market rate, were capped at Ksh 50 million per investor per tenor.

Competitive bids started at a minimum of Ksh2 million, while individual non-competitive bids required a minimum of Ksh50,000. The cap on non-competitive bids does not apply to State Corporations, public universities, and semi-autonomous government agencies.

The auction’s strong performance contrasts sharply with the previous auction held on December 24, 2025. At that time, the government offered the same Ksh24 billion but received bids worth only Ksh5.41 billion, a performance rate of 22.55 per cent.

The 182-day bills were the least popular, attracting just KSh 712 million in bids against a KSh 10 billion offer. Interest rates remained largely stable during that round, with the 91-day bills accepted at 7.7281 per cent, the 182-day at 7.8 per cent, and the 364-day at 9.2109 per cent.

Investor confidence

The strong demand in the December 31 auction reflects investors’ confidence in Treasury Bills as a safe and predictable investment. The Kenyan government has increasingly relied on domestic borrowing in recent years, after reduced external funding from donor countries and the International Monetary Fund.

Domestic borrowing through Treasury Bills and bonds allows the government to meet short-term fiscal needs and maintain market stability.

The Central Bank of Kenya (CBK) has maintained a stable monetary environment. Headline inflation remained at 4.5 per cent in November and December 2025, while core inflation declined to 2 per cent.

Non-core inflation rose to 11.2 per cent, driven by higher prices for fresh vegetables and energy. The Kenya shilling held steady at Ksh129.01 against the US dollar, while foreign exchange reserves remained adequate at USD 12,394 million, covering 5.3 months of imports.