Bond market activity remains moderate; yields up

• Mid-month bond auction announced
• Rupee appreciates marginally

 

By Wealth Trust Securities

The secondary bond market activity remained subdued yesterday, with yields edging up slightly. This was against the backdrop of a fresh supply from the announcement of a Rs. 90 billion Treasury Bond Auction due on 12.09.23 (next Tuesday). Limited trades were seen on the maturities of the 01.08.26 and 01.07.28 at levels of 15.40% to 15.65% and 14.65% to 14.80% respectively.

 In secondary bills, October/September, November, December 2023, February and March 2024 maturities traded at 17.00% to 17.50%, 18.00% to 18.50%, 17.50% to 17.80%, 15.50% to 16.25% and 15.15% to 15.36% respectively. The total secondary market Treasury bond/bill transacted volume for 06th September 2023 was Rs. 49.03 billion.

In money markets, the DOD (Domestic Operations Department) of Central Bank injected liquidity by way of an overnight and 28-day reverse repo auctions for a volume of 47.38 billion and 30.00 billion at weighted average rates of 11.53% and 14.11% respectively. While an amount of Rs. 49.21 billion was withdrawn from Central Banks SLFR (Standard Lending Facility Rate) of 12.00%. The net market liquidity deficit stood at Rs.53.24 billion yesterday. The weighted average rates on overnight call money and repo were registered at 11.58% and 11.93% respectively.

Forex Market 

In the Forex market, the Rupee or USD/LKR rate on spot contracts appreciated marginally to close trading yesterday at Rs.322.40/322.50 against its previous day’s closing level of Rs.322.50/322.75.

The total USD/LKR traded volume for 06th September 2023 was US $ 78.10 million.

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