Impressive outcome at primary bond auction

• Dull momentum in secondary bond market continues

 

By Wealth Trust Securities

The two Treasury bond auctions conducted yesterday recorded impressive weighted average yields, with the total offered amount of Rs. 25 billion been successfully subscribed. The 4 year and 9 month maturity of 15.09.24 recorded a weighted average yield of 9.87% while the 10 year 05 month maturity of 15.05.30 recorded a weighted average yield of 10.23%.

The dull momentum prevailing in the secondary bond market continued yesterday as well with most market participants opting to remain on the sidelines. Limited trades consisting of the 01.01.24, 15.09.24 and 15.03.25 were witnessed at levels of 10.00% to 10.05%, 9.85% and 10.14%. In the secondary bill market, the 6 December 2020 maturity changed hands at 7.90%. 

The total secondary market Treasury bond transacted volume for 10 December was Rs. 9.82 billion.

Meanwhile in money markets, the overnight call money and repo rates averaged at 7.52% and 7.66% as the Open Market Operations (OMO) Department of the Central Bank of Sri Lanka injected amounts of Rs. 14.3 billion and Rs. 5.0 billion respectively on an overnight basis and 07 day basis by way of Reverse Repo auctions at a weighted average rate of 7.53% and 7.61%.

It also injected an amount Rs. 19.7 billion for 14 days at a weighted average rate of 7.63%, value today, as the overnight net liquidity surplus in the system decreased to Rs. 9.62 billion. 

Rupee appreciates further

In the Forex market, the rupee on spot contracts were seen appreciating further yesterday to close the day at Rs. 180.80/90 against its previous day’s closing level of Rs. 181.10/15 on the back of continued selling interest by banks.

The total USD/LKR traded volume for 10 December was $ 89.58 million.

Some forward USD/LKR rates that prevailed in the market are: 1 month - 181.15/30; 3 months - 182.05/25; 6 months - 183.80/10.