Bond yields dip marginally ahead of weekly bills auction 

By Wealth Trust Securities

The secondary bond market remained active yesterday with yields continuing to trickle down on the liquid maturities of two 2021’s (i.e. 01.03.21, 01.08.21, 15.10.21 & 15.12.21), two 2023’s (i.e. 15.03.23 & 15.07.23) and 15.03.24 to intraday lows of 9.18%, 9.35%, 9.35%, 9.40%, 9.83% 9.87% and 9.97% respectively. In addition, a considerable volume on the 15.12.23 maturity was seen changing hands within the range of 9.90% to 10.00% while limited amount of trades were seen on the maturities of 01.08.24, 15.03.25, 01.08.26, 15.01.27 and 01.05.29 at levels of 10.10%, 10.19%, 10.21%, 10.27% and 10.47% respectively as well. On the very short end of the curve, 01.07.19, 15.09.19 and 01.11.19 maturities were seen changing hands at levels of 8.25%, 8.45% and 8.55% respectively while August 2019 and May 2020 maturing bills traded at levels of 8.30% and 8.70% respectively.

Today’s bill auction will have on offer a total amount of Rs.16.5 billion consisting of Rs. 3 billion on the 91 day, Rs. 5 billion on the 182 day and Rs. 8.5 billion on the 364 day maturities. At last week’s auction, weighted averages on the 182 day and 364 day maturities decreased by 03 and 02 basis points respectively to 8.60% and 8.86% while the weighted average on the 91 day maturity remained steady at 8.38%.

The total secondary market Treasury bond/bill transacted volumes for 24 June was Rs. 10.44 billion. 

In the money market, the OMO Department of the Central Bank of Sri Lanka was seen draining out a total amount of Rs. 10.00 billion by way of an overnight repo auction at a weighted average of 7.71% as the net liquidity surplus in the system stood at Rs. 19.60 billion yesterday. The overnight call money and repo rates averaged at 7.93% and 7.96% respectively. 

Rupee closes mostly unchanged   

The USD/LKR rate on spot contracts was seen closing the day mostly unchanged at Rs. 176.40/55 subsequent to trading within the range of Rs. 176.05 to Rs. 176.60 on the back of an even market. The total USD/LKR traded volume for 24 June was $ 102.31 million.

Some of the forward USD/LKR rates that prevailed in the market were 1 month - 177.18/28; 3 months - 178.63/73 and 6 months - 180.53/73.