Kenya’s 91-Day T-Bill Rate Holds at 7.56% as CBK Signals Deepening Monetary Easing Cycle

The Central Bank of Kenya (CBK) concluded its weekly Treasury Bills auction on March 19, 2026, with the 91-day T-bill rate settling at 7.5636% — a figure that rounds to 7.56% and marks one of the lowest short-term borrowing costs the country has seen in years. The 182-day paper came in at 7.8457%, while the 364-day bill was priced at 8.4805%, according to data published on the CBK’s official auctions portal. Collectively, these numbers paint a picture of a money market that is well-supplied with liquidity and anchored by a central bank that has been aggressively cutting its benchmark rate since August 2024.

Today’s auction results are not an isolated event. They are the latest milestone in a sustained downward trajectory for Kenyan short-term interest rates — a journey shaped by deliberate monetary policy choices, improving macroeconomic fundamentals, and a shift in investor behaviour that has redefined how both retail and institutional players engage with government securities.

Markets move fast; don’t get left behind. We’ve paired the Serrari Group Market Index with a curated Marketplace and a comprehensive Wealth Builder Course to ensure you have the data—and the skills—to act on it.

A Rate-Cut Cycle Without Precedent

To understand where Kenya’s T-bill market stands today, one must first appreciate the scale of the policy easing that preceded it. In February 2026, the CBK’s Monetary Policy Committee lowered the Central Bank Rate (CBR) by 25 basis points to 8.75%, marking the tenth consecutive cut since the easing cycle began. That cumulative reduction amounts to 425 basis points since August 2024, bringing the policy rate from a 12-year high of 13% down to its current level.

The implications for Treasury Bill yields have been direct and measurable. In mid-2024, the 91-day rate hovered well above 15%. By September 2025, it had slipped below the 8% mark for the first time since June 2022, a development that The Kenyan Wall Street described as extraordinary given the pace of investor demand. Today’s reading of 7.56% continues that trajectory, reinforcing the view that short-term rates in Kenya are now operating in genuinely accommodative territory.

CBK Governor Dr. Kamau Thugge, explaining the February decision, said the rate adjustment was intended to support lending to the private sector and stimulate economic activity while keeping inflation expectations firmly anchored. The MPC added that it would continue to closely monitor both domestic and global developments, with the next committee meeting scheduled for April 8, 2026.

What the 7.56% Rate Means for the Market

Treasury Bills are short-dated debt instruments issued by the government through the CBK, with the 91-day bill representing the shortest available tenor. They are used both as a financing tool for the National Treasury and as a benchmark for pricing risk-free returns in Kenya’s money market. When the 91-day rate falls, it typically signals that the market is liquid — meaning banks, asset managers, and other investors have cash available and are willing to lend it to the government at lower returns.

A rate of 7.56% on the 91-day paper is meaningful on several fronts. First, it reflects that competition among bidders remains strong, keeping yields suppressed. Second, it suggests the CBK’s monetary easing signals have been credibly received by the market. Third, and perhaps most practically, it reduces the government’s short-term borrowing costs, offering modest relief on a debt service burden that has been one of the most pressing fiscal concerns in recent years.

However, the picture across tenors tells a nuanced story. While the 91-day and 182-day rates remain compressed, today’s 364-day rate of 8.4805% shows that investors still demand a meaningful premium to lock money away for a full year. This spread between short- and long-term yields reflects residual uncertainty about medium-term fiscal dynamics, inflation risks, and the government’s overall borrowing trajectory.

Liquidity Conditions Remain Broadly Stable

The 7.56% outcome is consistent with what analysts and market participants have described as a broadly stable liquidity environment in Kenya’s banking system. Following the CBR cut to 8.75% in February, major commercial banks began lowering their lending rates, a signal that monetary policy transmission is functioning — albeit gradually and unevenly across institutions.

According to the CBK’s February 2026 MPC statement, the banking sector remains stable and resilient, with strong liquidity and capital adequacy levels. Gross non-performing loans declined to 15.5% in January 2026 from 16.7% in October 2025, reflecting improvements across real estate, manufacturing, trade, and construction. Private sector credit growth reached 6.4% in January 2026, up from 5.9% in December 2025 — a dramatic reversal from the contraction of 2.9% recorded in January 2025.

These credit metrics matter because they help explain why T-bill rates have softened. A more liquid banking sector with fewer stressed assets is more willing to deploy funds into low-risk government paper at tighter margins. The CBK’s narrowing of the interest rate corridor — from ±75 basis points to ±50 basis points around the CBR — has also helped align overnight interbank rates more closely with policy intentions, reducing the volatility that previously created arbitrage opportunities in short-dated government debt.

Inflation and Macro Stability Underpin Rate Stability

Kenya’s inflation story has been one of the more positive macro developments of the past 18 months. According to the MPC, overall inflation declined to 4.4% in January 2026 from 4.5% in December 2025, remaining comfortably below the 5% midpoint of the CBK’s official target band of 2.5% to 7.5%.

This subdued inflation environment has been a critical enabler of the easing cycle. With price pressures contained, the CBK has had room to cut rates without risking an overheating economy or currency depreciation. The Kenyan shilling has also remained broadly stable, with foreign exchange reserves standing at USD 12.46 billion as of February 2026, equivalent to approximately 5.37 months of import cover — well above the regional benchmark of four months.

Globally, the macro backdrop has also been relatively supportive. The MPC noted that global economic growth remained resilient in 2025, estimated at 3.3%, driven in part by lower-than-expected import tariffs, strong consumer spending, and rising investment in artificial intelligence. Central banks in advanced economies have continued to ease monetary policy, albeit at a cautious pace, providing Kenya’s monetary managers with external validation for their own accommodative stance.

Context is everything. While you follow today’s updates, use the Serrari Market Index and Marketplace to spot emerging shifts. Need to sharpen your edge? Our Wealth Builder Course turns these insights into a professional-grade strategy.

The Broader T-Bill Market: Trends and Tensions

Kenya’s T-bill market has undergone a remarkable structural shift over the past two years. In September 2025, The Kenyan Wall Street reported that the outstanding stock of Treasury Bills had surpassed KSh 1 trillion for the first time, reaching KSh 1.036 trillion in July and continuing to climb through August. T-bills now account for nearly 17% of domestic securities, up from 11.8% a year prior — a 68% year-on-year increase.

This expansion reflects the government’s growing reliance on short-term domestic borrowing to meet near-term fiscal needs. As external funding from donors and the International Monetary Fund has slowed, Treasury Bills have become an increasingly important financing tool for bridging gaps between revenue collection and expenditure. The National Treasury has set an ambitious domestic borrowing target for the 2026/2027 financial year, planning to finance 82% of Kenya’s budget deficit through domestic sources, raising approximately KSh 906 billion locally.

This dependence on the domestic market comes with risks. The expansion of short-term debt creates significant rollover and refinancing exposure — each week’s auction must not only raise new funds but also refinance the stock of bills maturing from previous weeks. In a low-rate environment, rollover risk is manageable. But should rates spike — due to inflation, currency pressure, or a loss of investor confidence — the government’s financing costs could rise rapidly.

Compounding this concern is Kenya’s overall public debt picture. As of November 2025, public debt stood at KSh 12.25 trillion, equivalent to 63.6% of GDP, with domestic debt primarily held by financial institutions. Debt servicing consumes a substantial share of government revenues, leaving limited fiscal space for development expenditure.

Recent Auction History Provides Context

The 7.56% rate does not exist in a vacuum. A review of recent auctions provides crucial context for understanding its significance.

At the auction for bills dated February 5, 2026, the CBK raised KSh 47.2 billion — nearly double its KSh 24 billion target — in a heavily oversubscribed auction. The 91-day rate at that time was 7.6326%, marginally above today’s 7.5636%, suggesting that the gentle downward drift in short-term rates has continued through February and into March.

Earlier, the year-end auction on December 31, 2025 raised KSh 25.9 billion against an advertised KSh 24 billion, representing a performance rate of 108%, with the 91-day rate held stable alongside the 182-day bill. September 2025 saw even more dramatic oversubscription, with total bids reaching KSh 38.77 billion against a KSh 24 billion offer, at rates just under 8% for the 91-day tenor.

Taken together, this pattern — consistent oversubscription, gradually declining yields, strong participation from both competitive and non-competitive bidders — points to a market that continues to find Kenya’s government paper attractive even as returns compress.

What Investors Should Watch Going Forward

The 7.56% rate on the 91-day bill is a data point, not a destination. Several factors will shape where rates go from here.

First, the April 8 MPC meeting will be closely watched. If the committee cuts the CBR again — extending the streak to eleven consecutive reductions — T-bill rates could fall further, particularly at the short end. Conversely, a hold or a hawkish shift in tone could stabilise or modestly lift yields.

Second, inflation dynamics remain critical. Non-core inflation, driven by food and energy prices, has shown volatility. A sustained uptick in the consumer price index would constrain the CBK’s room to ease further and could push yields higher as the market reprices inflation risk.

Third, government borrowing demand matters. If the National Treasury aggressively taps the T-bill market to meet its KSh 906 billion domestic borrowing target, supply could outpace demand and push rates higher. Alternatively, if fiscal consolidation progresses faster than expected, auction sizes could shrink, tightening supply and keeping rates low.

For retail investors using platforms like DhowCSD and Treasury Mobile Direct — the CBK’s digital infrastructure for small investors — the current rate environment presents an interesting trade-off: the 91-day bill at 7.56% offers a predictable, risk-free return, but one that is now notably below where it stood just 12 months ago. Investors seeking higher yields may find the 364-day bill at 8.48% or longer-dated Treasury Bonds more attractive, though these carry greater duration risk.

Conclusion

Kenya’s 91-day T-bill rate of 7.56% at today’s March 19, 2026 auction is a reflection of multiple converging forces: a central bank committed to monetary easing, a banking sector with ample liquidity, inflation well within target, and investor demand that continues to outpace government supply in most auction rounds. It represents the lowest short-term risk-free rate Kenya has offered in years — a development that is simultaneously a signal of macro stability and a prompt for investors, borrowers, and policymakers to think carefully about what comes next in a rapidly evolving financial landscape.

Your financial future isn’t something you wait for—it’s something you build.
The real question is: when do you begin?

Move beyond simply staying informed.
Navigate the markets with clarity—track trends through the Serrari Group Market Index, uncover opportunities in the Serrari Marketplace, and build practical knowledge with our Curated Wealth Builder Course.

Stay connected to what truly matters.
Get daily insights on macro trends and financial movements across Kenya, Africa, and global markets—delivered through the Serrari Newsletter.

Growth opens doors.
Advance your career through professional programs including ACCA, HESI A2, ATI TEAS 7 , HESI EXIT  , NCLEX – RN and NCLEX – PN, Financial Literacy!🌟—designed to move you forward with confidence.

See where money is flowing—clearly and in real time.
Track Money Market Funds, Treasury Bills, Treasury Bonds, Green Bonds, and Fixed Deposits, alongside global and African indexes, key economic indicators, and the evolving Crypto and stablecoin landscape—all within Serrari’s Market Index.

Photo Source: Google

By: Montel Kamau

Serrari Financial Analyst

19th March, 2026