Treasury to Focus on Domestic Borrowing as it Seeks to Reduce Foreign Debt
The National Treasury is planning to increase its borrowing in the domestic market as it seeks to hedge against external risks and cut down on foreign debt.
Treasury ‘s Director General of budget, Geoffrey Mwau says that this fiscal consideration is meant to bring debt and deficit levels down as it focuses on borrowing less and mainly on domestic currency in order to address the exchange risks
“Considering the global conditions with uncertainities, it is much better to reduce the exposure,” he said.
In January, the 2-year bond received bids worth Ksh76.9 billion while the bond got bids worth Kshh25.1 billion while the Treasury bills for the month were oversubscribed with bids worth Ksh139 billion.
This reflects a high appetite for short term instruments and increased liquidity in the market. Pension funds and commercial banks are, the biggest lenders to the government.
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