Bond yields dip marginally as activity remains high

By Wealth Trust Securities

The secondary bond market remained active yesterday as continued buying interest led to yields dipping across the yield curve. The liquid maturities of 2021’s (i.e. 15.10.21 and 15.12.21), 2023’s (i.e. 15.03.23 and 15.07.23), 01.08.24 and 15.10.25 saw its yields dip to intraday lows of 10.37%, 10.41%, 10.53%, 10.50%, 10.60%, and 10.55%, respectively, against its previous day’s closing levels of 10.45/53, 10.48/58, 10.58/65, 10.55/65, 10.65/75 and 10.70.80. However, profit taking at these levels curtailed any further downward movement. 

The total secondary market Treasury bond/bill transacted volumes for 19 September was Rs. 9.15 billion. 

In money markets, the overnight call money and repo rates averaged 8.02% and 8.01%, respectively, as the Open Market Operations (OMO) Department of the Central Bank injected an amount of Rs. 10 billion and Rs. 5 billion on an overnight basis and five days at weighted averages of 8.06% and 8.15% respectively. The market liquidity remained negative at Rs. 18.25 billion yesterday.

Rupee loses

The rupee on its spot contracts was seen depreciating considerably yesterday to close the day at Rs. 168.50/00 against its previous day’s closing levels of Rs. 167.00/40 on the back of continued importer demand.

The total USD/LKR traded volume for 19 September was $ 52.95 million.

Some forward USD/LKR rates that prevailed in the market are 1 month – 169.50/00, 3 months – 170.70/20, and 6 months – 173.80/30.

Closing secondary market yields of the most frequently traded Treasury bills and bonds