182- and 364-day bill averages resume descending

Thursday, 20 June 2019 00:00 - - {{hitsCtrl.values.hits}}

Secondary bond market yields continue to tumble

By Wealth Trust Securities

The 182-day and 364-day bill weighted averages at yesterday’s weekly Treasury bill auction decreased once again, following a laps of three weeks where weighted averages held steady or all bids were rejected.

The total offered amount of Rs. 19 billion was fully subscribed to, as the bids to offer ratio increased to a four week high of 3.22:1. The dips were recorded at 3 and 2 basis points on the 182-day and 364-day maturities, respectively, to 8.60% and 8.86%. The secondary bond market yields continued to decrease yesterday across the yields curve on the back of continued buying interest. The liquid maturities of 15.10.21, 15.03.22, 15.03.23, 15.03.24, 01.08.26 and 15.01.27 were seen dipping to intraday lows of 9.63%, 9.90%, 10.02%, 10.17%, 10.42% and 10.49%, respectively, against its previous day’s closing levels of 9.70/74, 9.90/95, 10.10/17, 10.25/29, 10.48/52 and 10.57/59.

In addition, buying interest on the two 2021’s (i.e. 01.05.21 and 01.08.21), 15.05.23, two 2024’s (i.e. 01.01.24 and 01.08.24) and 15.06.27 saw it change hands at levels of 9.50% to 9.60%, 10.10%, 10.22% to 10.25% and 10.63%, respectively, as well.

The total secondary market Treasury bond/bill transacted volumes for 18 June was Rs. 8.35 billion.

In the money market, overnight call money and repo rates averaged at 7.96% and 7.98%, respectively, as the OMO Department of the Central Bank was seen draining out an amount of Rs. 10 billion at a weighted average of 7.77%, by way of an overnight repo auction. The net liquidity surplus in the system increased to Rs. 24.32 billion yesterday.

Rupee strengthens

The USD/LKR rate on spot contracts strengthened yesterday to close the day at levels of Rs. 176.70/75 against its previous day’s closing levels of Rs. 176.80/85 on the back of selling interest by banks.

The total USD/LKR traded volume for 18 June was $ 90.52 million

Some of the forward USD/LKR rates that prevailed in the market were 1 month – 177.40/60; 3 months – 179.00/30, and 6 months – 181.00/40.

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