Bond market at a standstill ahead of weekly bill auction

By Wealth Trust Securities

The secondary bond market was at a standstill yesterday ahead of the weekly Treasury bill auction due today. A trade was seen on the 01.06.25 maturity at 25.00% while in the secondary bill market, September 2022 maturities traded at 25.00%.

The auction will see a total volume of Rs. 70 billion on offer, a reduction of Rs. 7.5 billion over its previous weeks total offered volume. This will consist of Rs. 35 billion on the 91 day maturity and Rs. 17.5 billion each on the 182 day and 364 day maturities. At last week’s auction, weighted average rates increased by 312, 250 and 180 basis points on the 91 day, 182 day and 364 day maturities respectively to 23.85%, 24.40% and 23.84%. An amount Rs. 71.17 billion was accepted in total at the auction while a further amount of Rs. 5.00 billion was raised at its Phase II of 91 day maturity.

The total secondary market treasury bond/bill transacted volume for 4 July was Rs. 5.56 billion.   

In money markets, the net liquidity deficit stood at Rs. 520.58 billion yesterday as an amount of Rs. 231.79 billion was deposited at Central Banks SDFR (Standard Deposit Facility Rate) of 13.50% against an amount of Rs. 752.36 billion withdrawn from Central Banks SLFR (Standard Deposit Facility Rate) of 14.50%. The weighted average rates on overnight Call money and REPO stood at 14.50% each.

Forex Market 

In the Forex market, the middle rate for USD/LKR spot contracts remained steady at Rs. 359.7941 yesterday. No trade was reported on 4 July.  

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