Bond market activity moderates ahead of Bond auctions

By Wealth Trust Securities

The primary Treasury bond auctions due today will see a total volume of Rs. 50 billion on offer, consisting of Rs. 15 billion of a 01.08.2025 maturity and Rs. 35 billion of a 15.01.2033 maturity.

The weighted average yield at the bond auction conducted on 11 January 2021 was 12.01% on the maturity of 01.12.2031 while an additional amount of Rs. 5 billion was taken up under its Direct Issuance window. The weighted average yields for the maturities of 15.03.2025 and 15.12.2027 were recorded at 11.05% and 11.70% respectively, while the second phase of the auction was opened on both maturities.

In secondary bond markets, limited trades were witnessed on the maturities of 2025’s (i.e. 15.03.25, 01.05.25 and 15.10.25) within the range of 11.40% to 11.50%.

The total secondary market Treasury bond/bill transacted volume for 26 January was Rs. 66.62 billion.   

In money markets, the net liquidity deficit stood at Rs. 452.19 billion yesterday with an amount of Rs. 62.93 billion been deposited at Central Banks SDFR (Standard Deposit Facility Rate) of 5.50% against an amount of Rs. 584.87 billion withdrawn from Central Banks SLFR (Standard Lending Facility Rate) of 6.50%. The Domestic Operations Department (DOD) of the Central Bank of Sri Lanka was seen draining out an amount of Rs. 69.75 billion by way of an overnight auction at a weighted average rate of 6.49%. The weighted average rates on overnight call money and repo were registered at 6.48% and 6.50% respectively.

USD/LKR   

In the Forex market, the USD/LKR rate on spot contracts traded at a level of Rs. 203 while the overall market remained inactive yesterday.

The total USD/LKR traded volume for 26 January was $ 69 million.   

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