Dull momentum in bond market continues ahead of weekly bill auction

By Wealth Trust Securities

The dull momentum in secondary bond markets continued yesterday, with a limited amount of activity seen on the two 2019 maturities (i.e. 01.07.19 and 01.11.19) and two 2021 maturities (i.e. 01.03.21 and 01.05.21) within the range of 9.60%-9.75% and 9.87%-9.90% respectively. 

In the secondary bill market, the May 2018, October 2018, November 2018 and March 2019 maturities were traded at levels of 8.25%, 9.00%, 9.05%-9.10% and 9.65% respectively.

Today’s weekly bill auction will have on offer a total amount of Rs. 26 billion, consisting of Rs. 4 billion of the 91-day maturity, Rs. 7 Billion of the 182 day maturity and a further Rs. 15 billion of the 364 day maturity. 

At last week’s auction, the weighted average yields continued to increase with the 91 day and 364 day maturities reflecting increases of eight and four basis points respectively to 8.32% and 9.70%. The 182 day bill was rejected for a third consecutive week.

The total secondary market Treasury bond/bill transacted volumes for 19 March 2018 was Rs. 1.10 billion.

In money markets, the Open Market Operations (OMO) Department of the Central Bank of Sri Lanka was seen draining out an amount of Rs. 21.7 billion by way of two repo auctions at weighted averages of 7.28% and 7.41% respectively for periods of one and seven days as the net surplus liquidity in the system stood at Rs. 30.58 billion. The overnight call money and repo rates averaged 8.15% and 7.64% respectively.

Rupee 

remains stable

The USD/LKR rate on spot contracts continued to remain steady to close the day at Rs. 156.10/15 yesterday, as activity moderated.

The total USD/LKR traded volume for 19 March 2018 was $ 45.45 million.

Some of forward USD/LKR rates that prevailed in the market were one month - 156.90/00; three months - 158.40/50 and six months - 160.80/90.