This week, the average lending rate eased further to 11.3% from 11.5%, reflecting the continued impact of December’s rate cut on monetary conditions. Meanwhile, interbank volumes took a significant hit, plunging by 38.2% to KES 33.58 billion from KES 54.36 billion, alongside a 35.7% drop in transaction count.
The table below summarizes the market liquidity indicators:
Open market operations eased this week, as bank bids declined to KES 78.08bn from KES 136.28bn in the previous week.
The Central Bank absorbed the entire amount, effectively offsetting maturities of KES 69.27bn, resulting in a net liquidity injection of approximately KES 8.81bn. This maneuver ensured the financial system remained well-lubricated.
Notably, the weighted average interbank rate has remained closely aligned with the Central Bank Rate (CBR), with actual highs and lows staying firmly within the interest rate corridor, reflecting a stable and well-regulated market environment.
See the chart below;
