Positive momentum at weekly bill auctions continue

• Secondary bond market activity picks up

By Wealth Trust Securities

The shortened trading week ending 06 May 2022 saw the weighted average rates on Treasury bills decreasing across the board for the first time in 21 weeks while the auction was fully subscribed for a second consecutive week as well.

This intern saw activity in the secondary bond market increasing during the week as the liquid maturities of 01.06.25 and 01.05.27 changed hands at levels of 21.67% to 21.70% and 21.50% to 22.05% respectively. In addition, 15.01.26 traded at 21.50% while the very short dated 01.10.22 traded at 23.75%.  

In secondary bills, July, August 2022, and May 2023 maturities traded at levels of 21.00% to 21.50%, 21.00% to 22.50% and 23.00% to 23.90% respectively.

The foreign holding in rupee bonds remained mostly unchanged at Rs. 2.71 billion for the week ending 04 May while the daily secondary market Treasury bond/bill transacted volumes for the first two trading days of the week averaged Rs. 6.24 billion.  

In money markets, the weighted average rates on call money and repo stood at 14.50% each for the week while the total outstanding liquidity deficit decreased to Rs. 708.77 billion by the end of the week against its previous weeks of Rs. 722.61 billion. The CBSL’s holding of Gov. Security’s registered at Rs. 1,869.84 billion against its previous weeks of Rs. 1,864.60 billion.

Forex Market 

In Forex markets, overall activity remained muted during the week. The daily USD/LKR average traded volume for the two trading days of the week stood at $ 17.65 million.  

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