Aggressive buying interest drives bond yields down

• Rupee steady

By Wealth  Trust Securities 

The aggressive and continued buying interest in the secondary bond market yesterday saw yields on the liquid 15.09.27, 01.05.28 and 15.05.30 maturities dipping further to intraday lows of 14.90, 14.40 and 14.25 respectively against its respective closing rates of 15.20/15.30, 14.75/14.85 and 14.40/14.50 the previous day. Buying interest on the rest of the yield curve was witnessed as well, as the maturities of 01.07.25, 15.05.26 and 01.07.32 changed hands at levels of 16.00%, 15.03% to 15.20% and 14.00% to 14.20% respectively. 

 In secondary bills, October 2023 maturities changed hands at levels of 19.49% to 20.49% and May-June 2024 maturities between 14.70% to 15.75% respectively. The total secondary market Treasury bond/bill transacted volume for 26 July 2023 was Rs. 89.10 billion. 

 In money markets, the DOD (Domestic Operations Department) of Central Bank injected liquidity by way of overnight and 7-day reverse repo auctions for a total volume of Rs. 95.40 billion at weighted average rates of 11.49% and 12.00% respectively while an amount of Rs.61.23 billion was withdrawn from Central Banks SLFR (Standard Lending Facility Rate) of 12.00%. The net liquidity deficit stood at Rs.153.88 billion yesterday. 

 The weighted average rates on overnight call money and repo were registered at 11.50% and 12.00% respectively.

 Forex Market 

In the Forex market, the USD/LKR on spot contracts closed the day at Rs.329.40/329.50 against its previous day’s closing level of Rs.329.25/329.50.The total USD/LKR traded volume for 26 July was US $ 57.00 million.

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