One-year bill crosses 7% for the first time in 15 months

• Market favourite 91-day bill increase to a 71-week high
• Bond market at a standstill

By Wealth Trust Securities

The benchmark one-year Treasury bill weighted average rate was seen increasing the 7% psychological level for the first time since April 2020 to record 7.01% at its auction held yesterday while the market favourite 91-day bill weighted average rate increased for a ninth consecutive week to register 6.70%, a level last seen in May 2020. The weighted average increases on the 91-day, 182-day and 364-day maturities was recorded at 32, 72 and 51 basis points respectively to 6.70%, 6.99% and 7.01%. However, the total accepted amount was seen falling short of the total offered amount for the eleventh consecutive week, as only Rs. 31.18 billion was accepted against a total offered amount of Rs. 51.5 billion while the bids-to-offer ratio stood at 1.40:1. 

Activity in the secondary bond market was at a standstill yesterday with a majority of market participants opting to be on the side-lines.

The total secondary market Treasury bond/bill transacted volume for 28 September was Rs. 4.95 billion.   

In money markets, the net liquidity deficit increased to Rs. 122.19 billion yesterday with an amount of Rs. 88.17 billion been deposited at the Central Bank’s SDFR (Standard Deposit Facility Rate) of 5% against an amount of Rs. 210.36 billion withdrawn from the Central Bank’s SLFR (Standard Lending Facility Rate) of 6%. The weighted average rates on overnight call money and repo remained steady at 5.94% and 5.93% respectively.

USD/LKR   

In the Forex market, the USD/LKR rate on spot contracts traded at level of Rs. 203 yesterday. The total USD/LKR traded volume for 28 September was $ 41.50 million.   

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