Bond yields increase marginally ahead of weekly bill auction

By Wealth Trust Securities

The secondary bond market yields increased marginally yesterday, mainly consisting of the liquid shorter end maturities of 01.05.20 and the two 2021’s (i.e. 01.03.21 and 01.05.21) to highs of 9.60%, 9.75% and 9.77% respectively, when compared against the previous day’s closing levels of 9.55/65, 9.68/73 and 9.73/78.  Furthermore, a limited amount of activity was witnessed of the 01.04.18 maturity at levels of 7.88% and the 2027 maturity at 10.25%.

At today’s Treasury bill auction, a total amount of Rs.22.5 billion will be on offer, consisting of Rs.2.5 Billion on the 91 day, Rs.7 Billion on the 182 day and Rs.13 billion on the 364 day maturities. At last week’s auction, the weighted average yields of the 182 day and 364 day bills declined by 28 and 30 basis points respectively to 8.48% and 9.04%, while the 91 day bill was not on offer.

The total secondary market Treasury bond/bill transacted volumes for 18 December was Rs.0.85 billion.

In money markets, the Overnight call money and repo rates averaged 8.13% and 7.52% respectively as the Open Market Operations (OMO) Department of the Central Bank was seen mopping up an amount of Rs.7.81 billion on an overnight basis at a weighted average of 7.25%. The net surplus liquidity stood at Rs.23.69 billion.

Rupee remains mostly unchanged

The USD/LKR rate on spot contracts remained mostly unchanged yesterday to close the day at Rs.153.10/20.

The total USD/LKR traded volume for 16 December was $ 103.05 million.

Some of the forward USD/LKR rates that prevailed in the market were one month – 154.15/30; three months – 155.80/00; and six months – 158.80/00.