91-day Treasury bill average increases for first time in four weeks

• Rs.  35 b T-bond auctions in focus

By Wealth Trust Securities

The 91 day or 3 month Treasury bill weighted average rate was seen increasing for the first time in four weeks, recording a jump of 71 basis points to 28.43% at its weekly auction conducted yesterday. 

It continued to dominate the auction as it represented 91.55% of the total accepted volume of Rs. 65.90 billion while falling below the total offered amount of Rs. 85 billion. However, the weighted average rate on the 364 day bill recorded a marginal decrease of 04 basis points to 29.15% while the weighted average rate on 182 day bill remained steady at 28.97%. 

The total bids to offer ratio stood at 1.51:1 while the phase 2 of the auction will be opened for the 182 day and 364 day maturities at its weighted average rates until close of the business of the day prior to settlement (i.e. 3:30 p.m. on 10.08.22). 

The Treasury bond auctions due today will see a total volume of Rs. 35 billion on offer, consisting of Rs. 15 billion of a 01.06.2025 maturity and Rs. 20 billion of a 15.07.2029 maturity.

The weighted average yields at the bond auctions conducted on 28th July 2022 were 28.45% and 23.91% respectively on the same 01.06.2025 maturity and a 15.05.2031 maturity while the total offered amount of Rs. 50 billion was taken up at its 1st and 2nd phases of the auction. The secondary bond market remained at a standstill yesterday.

The total secondary market Treasury bond/bill transacted volume for 8 August was Rs. 2.2 billion.   

In money markets, the net liquidity deficit stood at Rs. 461.95 billion yesterday as an amount of Rs. 296.10 billion was deposited at Central Bank’s Standard Deposit Facility Rate (SDFR) of 14.50% against an amount of Rs. 758.05 billion withdrawn from Central Bank’s SLFR Standard Lending Facility Rate (SLFR) of 15.50%. The weighted average rates on overnight Call money and REPO stood at 15.50% each.

Forex market 

In the forex market, the middle rate for USD/LKR spot contracts was at Rs. 360.94 yesterday against its previous day’s closing level of Rs. 360.80. The total USD/LKR traded volume for 8 August was $ 19.25 million.  

(References: Central Bank of Sri Lanka, Bloomberg E-Bond trading platform, Money broking companies)