364-day bill weighted avenge dips for a second consecutive week

• Secondary bond market yields decrease for second consecutive day 

By Wealth Trust Securities

The downward trend in the weekly weighted average yields continued for a second consecutive week at its weekly Treasury bill auction held yesterday as the 364-day maturity was seen decreasing by one basis point to 11.20%. 

The total offered amount of Rs. 18 billion was solely accepted on the 364 day maturity, rejecting all bids for the 182-day maturity. The bids to offer ratio increased to a five week high of 3.22:1.  

In the secondary bond market, yields were seen decreasing further mainly on the liquid maturities of the 15.12.21, 01.08.26 and 15.06.27 to lows of 11.85% and 12.30% each against its previous day’s closing levels of 11.90/95, 12.25/35 and 12.35/43.  In addition, activity was witnessed on the 15.05.23 and 01.09.28 maturities at 12.00% to 12.10% and 12.45% to 12.50% respectively as well.

In the money market, the OMO department of Central Bank infused liquidity for durations of overnight and seven days for successful amount of Rs. 25.15 billion and Rs. 14 billion at weighted averages of 8.50% and 8.54% respectively as the net liquidity shortfall stood at Rs. 55.49 billion yesterday. 

However the attempt to infuse liquidity for 14 days was not successful as no bids were received. The overnight call money and repo rates averaged 8.98% and 8.80% respectively.

Rupee appreciates to trade below Rs.180

The USD/LKR rate on spot contracts appreciated above the Rs. 180 psychological level to close the day at Rs. 179.60/90 against its previous day’s closing of Rs. 180.50/90 on the back of selling interest by banks.

The total USD/LKR traded volume for 27 November was $ 49.00 million.

Some of the forward USD/LKR rates that prevailed in the market were: one month – 180.65/15; three months – 182.70/20; and six months – 185.70/20.