Bond yields broadly steady ahead of weekly bill auction

By Wealth Trust Securities

The secondary bond market yields remained mostly unchanged yesterday as activity moderated ahead of today’s Treasury bill auction. Trades centred on 2023 durations, consisting of the 15.01.23, 15.03.23, 15.07.23 and 15.11.23 at levels of 5.67%, 5.85%, 6.00% and 6.20% to 6.21% respectively. In addition, a six-month bond of 15.12.21 changed hands at 5.22%. The secondary bill market saw, 1 October 2021 and 14 January 2022 bills change hands at levels of 5% and 5.23% respectively.

At today’s bill auction, Rs. 48 billion will be on offer, consisting of Rs. 15 billion on the 91-day maturity and Rs. 16.5 billion each on the 182-day and the 364-day maturities. The stipulated cut-off rate on the 364-day maturity remained steady at 5.23% while the maximum yield rates of the 91-day and 182-day maturities will be decided below the level of the 364-day maturity at the auction. At last week’s auction, the weighted average rate on the 91-day bill increased by one basis point to 5.18% while weighted average rates on the 182-day and 364-day maturities increased by two basis points each to 5.19% and 5.23% respectively.

The total secondary market Treasury bond/bill transacted volume for 5 July 2021 was Rs. 5.14 billion.   In money markets, the net liquidity surplus stood at Rs. 84.79 billion yesterday with an amount of Rs. 149.39 billion being deposited at Central Banks SDFR of 4.50% against an amount of Rs. 64.60 billion withdrawn from Central Banks SLFR of 5.50%. The weighted average rates on call money and repo were registered at 4.94% and 4.96% respectively.

USD/LKR   

In Forex markets, the overall market continued to remain inactive yesterday. 

The total USD/LKR traded volume for 5 July 2021 was $ 40.10 million.   

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