91 day Treasury bill weighted average tumbles

• Bond market inactive ahead of auctions

By Wealth Trust Securities

The weekly Treasury bill auction held yesterday saw its weighted average rates on all three maturities decrease for a second consecutive week, led by the market favourite 91 day bill maturity by a massive 264 basis points to a three week low of 28.86%. The 182 day and 364 day maturities registered dips of 73 and 29 basis points to 29.24% and 29.53% respectively as well. The total offered amount of Rs. 85 billion was successfully accepted at the auction as its bids to offer ratio stood at 2.16:1. 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 business of the day prior to settlement (i.e. 3:30 p.m. on 28.07.2022). 

The Treasury bond auctions due today will see a total volume of Rs. 50 billion on offer, consisting of Rs. 20 billion of a 01.06.2025 maturity and Rs. 30 billion of a 15.05.2031 maturity.

The weighted average yields at the bond auctions conducted on 11 July were 28.18% and 26.51% respectively on the same 01.06.2025 maturity and the 15.07.2029 maturity. An amount of Rs. 3.55 billion was accepted on the 01.06.25 maturity against its offered amount of Rs. 30 billion while an additional amount of Rs. 8 billion was taken up under the direct Issuance windows on the 15.07.2029 maturity subsequent to Rs. 40 billion been subscribed at its phase I of the auction. 

In secondary market, bonds remained inactive for a third consecutive day while October 2022, January 2023 and July 2023 bill maturities traded at low of 27.00%, 28.00% and 28.50% respectively, subsequent to auction results.The total secondary market Treasury bond/bill transacted volume for 26 July was Rs. 5.5 billion.   

In money markets, the weighted average rate on overnight Call money and REPO stood at 15.50% each while the net liquidity deficit stood at Rs. 433.99 billion yesterday. An amount of Rs. 289.44 billion was deposited at Central Banks SDFR (Standard Deposit Facility Rate) of 14.50% while an amount of Rs. 723.43 billion was withdrawn from Central Banks SLFR (Standard Deposit Facility Rate) of 15.50%.

Forex market

In the Forex market, the middle rate for USD/LKR spot contracts remained steady at Rs. 361.00. The total USD/LKR traded volume for 26 July was $ 10.16 million.

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