Bond yields decrease ahead of weekly auction

Wednesday, 4 January 2023 00:00 - - {{hitsCtrl.values.hits}}

By Wealth Trust Securities

Renewed buying interest on the liquid maturities of 15.01.25 and 15.05.26 saw secondary market bond yields decreasing yesterday ahead of today’s weekly Treasury bill auction.

The yields on the said maturities decreased to intraday lows of 33.00% and 30.90% respectively against its previous day’s closing levels of 33.00/50 and 31.40/70.

Today’s weekly Treasury bill auction will have in total an amount of Rs. 98 billion on offer, unchanged from last week. This will consist of Rs. 60 billion on the 91-day maturity, Rs. 20 billion on the 182-day maturity and a further Rs. 18 billion on the 364-day maturity.

At last week’s auction, weighted average rates decreased across the board for a third consecutive week by 03 basis points each to 32.64%, 32.20% and 29.27% on the three maturities respectively. The total offered amount of Rs. 98.00 billion was accepted at the 1st phase of the auction while a further amount of Rs. 10.34 billion was raised at its phase II.

The total secondary market Treasury bond/bill transacted volume for 2 January 2023 was Rs. 3.27 billion.

In money markets, the weighted average rates on overnight call money and REPO stood at 15.50% each while an amount of Rs. 547.00 billion was withdrawn from Central Banks SLFR (Standard Deposit Facility Rate) of 15.50%.

The net liquidity deficit stood at Rs. 207.40 billion yesterday as an amount of Rs. 339.59 billion was deposited at Central Banks SDFR (Standard Deposit Facility Rate) of 14.50%.

Forex Market

In the Forex market, the middle rate of USD/LKR spot contracts remained steady for a third consecutive day at Rs. 363.11.

The total USD/LKR traded volume for 2 January was $ 16.00 million.

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