Kenya, April 24 -- Money Market Funds (MMFs) remain a cornerstone of low-risk, high-liquidity investments in Kenya, offering investors stable returns amidst fluctuating economic conditions.
As of April 2025, the latest data reveals the annual yield rates for MMFs across the country, showcasing a range of returns for investors seeking to grow their savings.
The following is a detailed breakdown of the yields, reflecting the performance of key funds in the Kenyan market;
The data highlights GulfCap MMF as the top performer with a 14.0% annual yield, closely followed by Cytonn MMF at 13.9% and Kuza MMF at 13.8%.
On the lower end, Equity MMF recorded the lowest yield at 5.5%, significantly below the average. Notably, Mayfair MMF has shown improvement, climbing above 14% in recent days to become a standout performer.
The yields reflect a broader trend of softening MMF returns, driven by declining interest rates on government securities like Treasury Bills, which fell to 8.9% for the 91-day T-bill as of March 2025, according to Lofty Corban.
The Central Bank of Kenya's (CBK) recent rate cuts, including a reduction of the Central Bank Rate (CBR) to 10.75% in February 2025, have further influenced these yields, as MMFs heavily invest in short-term securities sensitive to monetary policy changes.
Despite the decline, most funds continue to outperform the 91-day Treasury Bill rate, making them an attractive option for risk-averse investors.
Economic conditions, including a stabilized inflation rate of 3.5% in February 2025, have contributed to the normalization of MMF returns, which are now trending toward their historical range of 8-11%, as noted by Lofty Corban.
The Capital Markets Authority (CMA) continues to ensure transparency and investor protection, fostering confidence in the MMF market.
Investors are advised to consider factors such as expense ratios, fund history, and tax implications when selecting an MMF, as these can impact net returns.
Published by HT Digital Content Services with permission from Bana Kenya.