Bond yields dip marginally ahead of weekly bill auction

By Wealth Trust Securities

The secondary bond market remained active during the first half of the day yesterday with yields dipping marginally across the yield curve. 

Buying interest on the maturities of 15.03.24, 15.01.27 and 01.05.29 saw its yields dip to daily lows of 10.95%, 11.15% and 11.25% respectively against its yesterday’s closing levels of 10.90/00, 11.15/30 and 11.20/35. In addition, the two 2021 (01.08.21 and 15.12.21) along with the 15.03.23 maturities were seen changing hands at levels of 10.40%, 10.35% and 10.85% respectively as well.

Today’s weekly bill auction will have in total an amount of Rs 25 billion on offer consisting of Rs. 4, 5 and 16 billion on the 91 day, 182 day and 364 day maturities respectively. At last week’s auction, weighted averages dipped across all three maturities for a fifth consecutive week to record 9.00%, 9.19% and 9.91% respectively.

The total secondary market Treasury bond/bill transacted volumes for 18 April was Rs. 3.60 billion. 

The overnight call money and repo rates remained steady to average 8.52% and 8.64% respectively with the overnight net liquidity remaining at a healthy surplus of Rs. 34.37 billion. 

The OMO (Open Market Operations) Department of the Central Bank of Sri Lanka injected liquidity by way of an overnight and fourteen day reverse repo auctions for successful amounts of Rs. 5 billion and Rs. 10 billion respectively at a weighted averages of 8.53% and 8.59% respectively. 

Rupee dips marginally

 The USD/LKR rate on its spot contract dipped marginally yesterday to close the day at Rs. 174.60/90 against its previous day’s closing of Rs. 174.50/70 on the back of demand by banks.

The total USD/LKR traded volume for 22 April was $ 22.30 million

Given are some forward USD/LKR rates that prevailed in the market: one month – 175.70/10; three months – 177.65/05; six months – 180.50/90.