Bond auctions attract 69% in successful bids

• Rs. 67.5 b on offer at weekly T-bill auction

By Wealth Trust Securities

The bond auctions conducted yesterday attracted only 68.61% or Rs. 27.44 billion of successful bids against a total offered amount of Rs. 40 billion.

The offered amount of Rs. 25 billion on the nine-year maturity of 15.05.2031 was taken up fully at its first phase of the auction at a weighted average of 29.52%, which in turn will see a further 20% being offered through a direct issuance window until close of business today. (I.e., 4.00 p.m. on 31 August).

The weighted average rate on the three-year maturity of 01.07.2025 was registered at 29.16% while it went undersubscribed which led to its second phase of the auction. In all, only Rs. 2.44 billion was accepted in successful bids against an offered amount of 15 billion.

Today’s weekly Treasury bill auction will have in total an amount of Rs. 67.5 billion on offer, a drop of Rs. 22.5 billion in comparison to its previous week’s offered amount. This will consist of Rs. 20 billion each of the 182-day and 364-day maturities and a further Rs. 27.5 billion of the 91-day maturity. 

At last week’s auction, weighted average rates increased across the board by 107, 55 and 69 basis points respectively on the 91-day, 182-day and 364-day maturities to 30.51%, 29.51% and 29.83%. An amount of Rs. 56.71 billion was accepted in total at the auction while a further amount of Rs. 3.19 billion was raised at its Phase II.

Activity in the secondary bond market remained at a standstill yesterday due to all market participants continuing to be on the sidelines.

In money markets, the net liquidity deficit stood at Rs. 477.04 billion yesterday as an amount of Rs. 802.59 billion was withdrawn from Central Banks SLFR (Standard Deposit Facility Rate) of 15.50% against an amount of Rs. 325.55 billion deposited at Central Banks SDFR (Standard Deposit Facility Rate) of 14.50%. The weighted average rates on overnight REPO stood at 15.50% while no Call money transactions were reported.

Forex Market

In the Forex market, the middle rate for USD/LKR spot contracts depreciated marginally to Rs. 361.29 yesterday against its previous day’s closing level of Rs. 361.17. The total USD/LKR traded volume for 29 August 2022 was $ 9.77 million. 

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