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Market Commentary
Key Features
Fund Manager | CIC Asset Management Ltd |
Launch Date | Jun - 11 |
Risk Profile | Low - Medium |
Trustee | Kenya Commercial Bank |
Custodian | Co-op Custodial Services |
Auditors | PWC |
Minimum Investment | Ksh 5,000,000 |
Minimum Additional Investment | Ksh 1,000,000 |
Initial Fee | 0 |
Annual Management Fee | 2.00% |
Distribution | Maturity |
Asset Under Management | KES 7.2 Billion |
Fund Objective
- Capital preservation
- Enhanced level of return with slightly elevated risk profile compared to Money market.
- Ideal for short term cash management.
GDP
Real GDP expanded by 5.0 per cent in 1Q24 compared to 5.3% in 1Q23 (vs 5.5% in 4Q23). The positive growth was primarily notable in the
Agriculture sector +6.1%y/y on increased tea, milk, sugarcane production, though weighed by lower coffee and flower exports. Notable growth was also noted in real estate +6.6%y/y, financial and insurance services +7.0%y/y, ICT +7.8%y/y, accommodation and food services +28.0%y/y.
Inflation
Inflation decelerated, hitting a near 4-year low, due to slower growth in food and fuel prices. June inflation print came in at 4.6% compared to a restated 5.0% in May. 1H24 inflation averaged 5.6% vs 8.5% in 1H23. We anticipate the annual inflation rate to oscillate within the mid-point (5.0%) of CBK’s target range supported by the declining food and fuel inflation.
Interest Rates
Relative price stability combined with fairly decent economic growth prospects prompted the MPC to retain the Central bank rate at 13%. The increase in short-term papers has been somewhat moderate, with the 91, 182 and 365 day papers closing the first half of the 2024 at 15.98%, 16.76% and 16.79% respectively.
Outlook
Rates on government securities should remain elevated as interest rates remain high. The wealth fund rates are therefore expected to remain elevated as funds placed continue to reflect the high rates.
Fund Performance
Asset Allocation
90 Day T- Bill & Inflation Rate
Maturity Profile
Statutory Disclaimer: The value of units may go down as well as up and past performance is not necessarily a guide to the future. There are no guarantees on the client’s capital as the performance of units in the fund is determined by changes in the value of underlying investments hence value of your unit trust investment.
