Bond market sees slight uptick in activity ahead of weekly Treasury Bill Auction

By Wealth Trust Securities

The secondary bond market saw some resurgence in activity yesterday, albeit still at moderate levels ahead of the weekly Treasury bill auction due today. Limited trades were seen on the liquid maturities of 15.01.25, 15.09.27, 01.05.28, 15.05.30 and 01.07.32 at 13.40% to 13.55%, 12.97% to 12.99%, 12.80% to 12.85%, 12.70% to 12.75% and 12.85% to 13.03% respectively. Meanwhile in the secondary bill market, November 2023, December 2023 and August 2024 maturities traded at levels of 17.25% to 17.50%, 18.00% and 13.30% respectively.

Today’s weekly Treasury bill auction will have in total an amount of Rs. 130 billion on offer which will consist of Rs. 70 billion on the 91-day maturity, Rs. 30 billion on the 182-day maturity and a further Rs. 30 billion on the 364-day maturity.

At last week’s auction, the weighted averages decreased across the board to 17.55%, 14.87% and 13.19% on the 91-day, 182-day and 364-day maturities respectively. An amount of Rs. 180.00 billion was accepted at the 1st phase of the auction while a further amount of Rs. 12.48 billion was raised at its phase II.

The total secondary market Treasury bond/bill transacted volume for 21 August 2023 was Rs. 2.55 billion. In money markets, the DOD (Domestic Operations Department) of Central Bank injected liquidity by way of an overnight reverse repo auction for a volume of Rs.  94.10 billion at a weighted average rate of 11.51% while the net liquidity deficit stood at Rs. 168.55 billion yesterday.

Further an amount of Rs. 74.96 billion was withdrawn from Central Banks SLFR (Standard Lending Facility Rate) of 12.00% while the weighted average rates on overnight call money and repo were registered at 11.79% and 12.00% respectively

Forex Market 

In the Forex market, the USD/LKR rate on spot contracts closed at Rs. 323.80/324.25 yesterday against its Fridays closing level of Rs.3 23.50/324.25.

The total USD/LKR traded volume for 21 August was $ 53.23 million. 

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