Moody’s sees investor boost in Kenya sovereign bond plan

http://www.businessdailyafrica....4/-/15ijp0a/-/index.html

sovereign bond would be used to retire the syndicated loan, as the former is expected to be cheaper.

apparently the governor said that article was rubbish and he didn't say anything of the sort. I think in this case we have poor journalism.

@hisah. There's about 43 billion in repo maturities this week versus Tbill auction of 8 billion and repo yielding higher. 7-day up today from 9.30% to 9.68%, so what else can we expect when CB mops up all the liquidity on OMO. They give the impression that there's demand for borrowing so the cost of borrowing must follow. Interference by CB affecting fiscal policy in order to keep the shilling protected. So now we have over 43 billion outstanding in repos. That's a lot of KES so CB can't leave the repo market just yet either.

IMF pushes for wider VAT net to boost tax revenue - http://www.businessdaily...-/127lpckz/-/index.html

I really hope VAT on essential foods is scrapped off. Bad idea since it'll squeeze very many households especially the low income bracket, which will be hardest hit.

It is no secret that IMF advice must always be taken with a pitch of salt. If IMF expects KE's GDP to grow by 5% in 2012, yet the econ is on a slowdown as per KNBS @ 3.3%. If IMF says KE's debt to GDP ratio above 50% is sustainable yet gok is sweating to balance the budget and facing constant labour protests. IMF advised that EA changes the inflation model in 2010 to be more accurate and inflation suddenly spiked with EA currencies taking a good beating.

Would you really take advice from a stranger on how to run your house yet they dont live in that house?

Personally I want those negative elements in that Finance bill to be totally eliminated or the bill crashes. Amen.

If anyone can point to me a single proposal that IMF/WB has recommended and helped a nation to be prosperous, then and only then can I stop my biased critism on them.

2yr bond yield also spiking higher...

Certainly a very confusing scenario when fundamentals say that interest rates should remain low, but with IMF pushing for consumption tax increases and high bank liquidity, can we really afford to lower the CBR any further? Tbills edging up, repo rates up and the 2yr bond issue took a beating... up 152bps in 2 months... and the results only show the 'weighted average rate of accepted bids' and the 'market weighted average rate', but no one knows the cut-off yield (which remains undisclosed by CBK) where some folks believe it rose by 168bps from 11.51% to 13.19% (that means the highest yield CBK was willing to pay investors rose faster than what the market was willing to bid - says a lot about how much gava really needs to borrow).

But it seems as Treasury front-loads borrowing we'll have an interesting scenario next year, where bank liquidity is high, shilling legs still wobbling, inflation leveling out, and bond rates remaining high. This means no cut in the CBR next month. The winner theoretically should be money markets as analyst factor in the interest rate and potential inflation spikes into their WACC (though probably depends on ur sector). But i'm hopeful something can be done about GDP growth and the shakey housing market... some upmarket areas will not be affected, but i'm sure some folk are feeling the financing cost. The equity rally goes on despite elections, but do you blame the foreigners driving the NSE, they probably don't have anywhere else to put their money but in frontiers.