Saturday Sep 28, 2024
Saturday Sep 28, 2024
Monday, 8 January 2024 02:30 - - {{hitsCtrl.values.hits}}
By Wealth Trust Securities
The secondary bond market commenced the trading week ending 5 January on a subdued note. However, activity was seen increasing during the latter part of the week as considerable buying interest was observed on the 2026 durations which saw its yields decline during the week.
This was against the backdrop of an outright purchase auction conducted by the Domestic Operations Department (DOD) of CBSL on the 01.06.26 and 01.08.26 maturities. However, the rest of the yield curve remained broadly unchanged, as at the close of the inaugural trading week of 2024.
Accordingly, the yields on the short to medium duration maturities of the four 26’s (01.02.26, 15.05.26, 01.06.26 and 01.08.26), 15.09.27 and two 28’s (01.07.28 and 15.03.28) and 15.05.30 were seen trading within the ranges of 14.03% to 13.75%, 14.18% to 14.10%, 14.25% to 14.10% and 14.20% respectively.
Meanwhile last week’s Treasury bill auction saw the weighted average rate on the 91-day maturity decline by 6 basis points to 14.45%, seeing strong demand with bids exceeding the offered amount.
The 182-day maturity also saw impressive demand with the bids received being Rs. 122.80 billion versus an offered amount of only Rs. 70.00 billion.
However, its weighted average yield remained unchanged. The 364-day maturity also remained unchanged at 12.93%. An amount of Rs. 155.18 billion or 96.99% of the total offered amount of Rs. 160.00 billion was raised at the 1st phase of the auction while an additional amount of Rs 6.20 billion was raised at the 2nd phase, only on the 364-day maturity.
The foreign holding in Rupee bonds and bills saw a net inflow for the first time 11 weeks, to the tune of Rs 1.02 billion for the week ending 4 January, while the total holding stood at Rs. 118.46 billion.
The daily secondary market Treasury bond/bill transacted volumes for the first four days of the week averaged at Rs. 28.91 billion.
In money markets, the total outstanding liquidity deficit reduced to Rs 88.19 billion by the week ending 5 January from its previous week’s deficit of Rs. 105.99 billion.
The Domestic Operations Department (DOD) of Central Bank continued to inject liquidity during the week by way of overnight and term reverse repo auctions at weighted average yields ranging from 9.05% to 10.71%.
The Central Bank of Sri Lankas (CBSL) holding of Gov. Security’s was registered at Rs. 2,743.62 billion, unchanged against its previous week’s level.
Forex Market
In the Forex market, the USD/LKR rate on spot contracts was seen appreciating during the week to close at Rs. 322.45/65. This is as against its previous weeks closing level of Rs. 323.90/324.00 and subsequent to trading at a high of Rs. 323.65 and a low of Rs. 320.55.
The daily USD/LKR average traded volume for the first four trading days of the week stood at $ 73.49 million.
(References: Central Bank of Sri Lanka, Bloomberg E-Bond trading platform, Money broking companies)
