Kenya’s money market demonstrated resilience during the week ending July 30, 2026, as commercial banks maintained Ksh13.5 billion in excess reserves above the mandatory Cash Reserve Ratio (CRR), according to the Central Bank of Kenya (CBK).
In its weekly bulletin released on July 31, 2026, the CBK highlighted that liquidity in the banking sector remained sufficient despite ongoing open market operations designed to support monetary policy goals.
Strong Liquidity Amid Active Market Operations
Commercial banks held reserves exceeding the 3.25% CRR requirement by an average of Ksh13.5 billion, underscoring continued financial system stability. The Kenya Shilling Overnight Interbank Average Rate (KESONIA) held steady at 8.75%, unchanged from the previous week, reflecting stable short-term lending conditions.
Surge in Interbank Trading
The interbank market saw a notable increase in activity during the review period:
- Average interbank transactions rose to 17 from 6 the prior week.
- Average daily value traded surged to Ksh12 billion from Ksh3.7 billion.
This uptick indicates enhanced lending among banks as they adjust short-term liquidity while maintaining adequate cash buffers.
Ongoing Market Stability
The latest data aligns with earlier CBK assessments showing the money market’s resilience amid evolving conditions. In April 2026, excess reserves stood at Ksh12.8 billion above requirements, with interbank rates close to the Central Bank Rate.
The CBK continues to conduct open market operations to ensure liquidity aligns with monetary policy objectives, supporting a well-funded banking sector that facilitates economic activity.
