Bond yields remain broadly unchanged ahead of Weekly T-bill auction

Wednesday, 1 February 2023 00:00 - - {{hitsCtrl.values.hits}}

Inflation continues to decline

By Wealth Trust Securities

The secondary bond market yields remained mostly unchanged yesterday ahead of today’s weekly Treasury bill auction.

Activity was witnessed on the 01.07.25, 15.05.26, 01.05.27 and 15.01.28 maturities at levels of 32.50%, 29.00% to 29.50%, 29.28% to 29.35% and 27.00% respectively.

Today’s weekly Treasury bill auction will have in total an amount of Rs. 120 billion on offer, unchanged from last week. This will consist of Rs. 60 billion on the 91-day maturity, Rs. 30 billion each on the 182-day and 364-day maturities.

At last week’s auction, weighted average rates decreased across the board for a seventh consecutive week by 17, 35 and 47 basis points to 29.91%, 28.72% and 27.78% on the three maturities respectively.

The total offered amount of Rs. 120.00 billion was accepted at the 1st phase of the auction while a further amount of Rs. 16.14 billion was raised at its phase II.

The Colombo Consumer Price Index (CCPI) or inflation for the month of January was seen decreasing for a fourth consecutive month to 54.2% on its point to point as against 57.2% recorded in December while it’s annualised rate increased to 49.6% from 46.4%.

The total secondary market Treasury bond/bill transacted volume for 30th January 2023 was Rs. 24.11 billion.

In money markets, the net liquidity deficit was registered at Rs. 44.85 billion yesterday as an amount of Rs. 74.11 billion was deposited at Central Banks SDFR (Standard Deposit Facility Rate) of 14.50% against an amount of Rs. 118.95 billion withdrawn from Central Banks SLFR facility (Standard Lending Facility Rate) of 15.50%.

The weighted average rates on overnight call money and REPO stood at 15.26% and 15.50% respectively.

Forex Market

In the Forex market, the middle rate for USD/LKR spot contracts remained steady for a third consecutive day at Rs. 362.14 yesterday.

The total USD/LKR traded volume for 30th January was $ 4.35 million.

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