Activity remains moderate ahead of T-Bond auctions

• Liquidity increases to a 2-week high; CBSL holding of Govt. Securities exceeds Rs. 1 trillion

By Wealth Trust Securities

The yields in the secondary bond market increased marginally yesterday on the back of moderate activity, as the liquid maturities of 15.11.23 & 01.12.24 hit intraday highs of 6.28% and 6.76% respectively against its previous day closing levels of 6.25/30 and 6.65/75. In addition, the 15.07.23 maturity was seen changing hands at levels of 6.05% to 6.07% as well. In secondary bills, July 2021 maturities were traded within the range of 4.92% to 5.10%.

Today’s auction will have on offer a total amount of Rs. 50 billion, consisting of Rs. 27.5 billion of the 15.10.2025 maturity and Rs. 22.5 billion of the 15.03.2028 maturity. The maximum yield rate for acceptance for the said maturities was published at 7.31% and 8% respectively. The weighted average yields at the bond auctions conducted on 11 June 2021 were 7.31% and 8.02% for the maturities of 15.01.2026 and 01.05.2028 respectively.

The total secondary market Treasury bond/bill transacted volume for 25 June 2021 was Rs. 1.62 billion.   

In money markets, the overnight net liquidity surplus was seen increasing to over a two-week high of Rs. 105.21 billion as an amount of Rs. 156.26 billion was deposited at Central Banks SLDR of 4.50% against an amount of Rs. 51.05 billion withdrawn from Central Banks SLFR of 5.50%. The CBSL’s holding of Gov. Securities was seen crossing the Rs. 1 trillion mark for the first time in its history, to record Rs. 1,127.65 billion against Rs. 919.22 billion the previous day. The weighted average rates on overnight call money and repo increased marginally to 4.88% and 4.92% respectively.

USD/LKR   

In Forex markets, the overall market continued to remain inactive yesterday. The total USD/LKR traded volume for 25 June 2021 was $ 79.25 million.   

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