MONEY MARKET ANALYSIS
Interbank lending paced up during the week with the traded volumes jumping 30.1% to KES 12.12bn from KES 9.31bn, in the previous week, despite a decline in the number of transactions. Reflecting the softened liquidity stance, the average interbank rate dropped slightly to 10.65% from 10.68% the prior week. The table below summarizes the market liquidity indicators:
During the week, the Central Bank mopped KES 176.95bn worth of liquidity from the market, a 29.6% decrease from last week’s KES 251.30bn. The amount fell below the target of KES 290bn with the average rate coming in at 10.74%. See below a visual chart;
The weighted average interbank rate has closely tracked the Central Bank Rate, underscoring the stability and effectiveness of the monetary policy framework. See the chart below;
