Bond yields remain mostly unchanged ahead of weekly bill auction

By Wealth Trust Securities

The secondary bond market yields closed the day mostly unchanged, subsequent to trading within a narrow range, ahead of today’s weekly Treasury bill auction.

Today’s auction will have on offer  a total amount of Rs.20 billion, consisting of Rs.2 billion on the 91 day, Rs.8 billion on the 182 day and Rs.10 billion on the 364 day maturities. At last week’s auction, weighted average yields of the 91 day and 182 day maturities decreased by 01 basis point each to 7.49% and 7.65% respectively with the 364 day maturity increasing by 01 basis point to 8.35%. 

In the secondary bond market, the 2022s (i.e. 15.03.22, 01.07.22 and 15.10.22), 2023s (i.e.15.05.23, 15.07.23 and 15.12.23) and 2024s (i.e. 15.03.24 and 15.09.24)  were seen changing hands at levels of 9.05% to 9.20%, 9.68% to 9.75% and 9.98% to 10.04% respectively while the 2027s (i.e. 15.06.27 and 15.10.27), 01.05.29 maturity and the 15.09.34 maturity were traded at levels of 10.25% to 10.30%, 10.30% to 10.33% and 10.65% to 10.67% as well. 

In money markets, the Open Market Operations (OMO) Department of the Central Bank refrained from conducting any auctions for the fourth consecutive day as the net overnight liquidity in the system remained at a surplus of Rs.17.89 billion. The overnight call money and repo rates averaged at 7.47% and 7.51% respectively. 

Rupee appreciates to below Rs. 180

In the Forex market, the appreciating trend of the LKR continued for a fourth consecutive day with the rupee on spot contracts closing the day at a level of Rs.180.20/40 against its previous day’s closing level of Rs.180.50/60, subsequent to trading at a high of Rs.179.75 for the first time since 2 September. 

The total USD/LKR traded volume for 4 November was $ 47.85 million.

Given are some forward USD/LKR rates that prevailed in the market: One month – 180.75/00; three months – 181.90/30; six months – 183.80/30.

Correction to 4 November report: In the Forex market, the rupee on spot contracts was seen appreciating considerably yesterday to a high of Rs. 180.40, before closing at a level of Rs. 180.50/60 against its previous day’s closing level of Rs. 181.05/20 on the back of selling interest by banks.