Rs. 45 b bond auctions fully taken up

• Secondary bond market rallies
• Rupee dips

By Wealth Trust Securities

The Treasury bond auctions conducted yesterday recorded a robust outcome as it was fully subscribed at its first and second phases. Given below are the details of the auction,

A direct issuance window for the 15.01.27 maturity is open until close of business of the day prior to settlement date (i.e., 4.00 pm on 30.11.2023) at the weighted average yield rate determined at the first phase. The secondary bond market witnessed a rally post-auction as buying interest pushed down yields while activity increased. Accordingly, the maturities of the two 24’s (01.05.24 and 15.11.24), three 25’s (15.01.25, 01.06.25 and 01.07.25), three 26’s (15.05.26, 01.06.26 and 01.08.26), two 27’s (15.01.27 and 01.05.27) and two 28’s (01.05.28 and 01.07.28) traded within the ranges of 14.65% to 14.00%, 14.05% to 13.97%, 14.50% to 14.20%, 14.55% to 14.20% and 14.60% to 14.50% respectively.

Meanwhile, the weekly Treasury bill auction due today will have in total an amount of Rs. 160 billion on offer, which will consist of Rs. 60 billion on the 91-day maturity, Rs. 70 billion on the 182-day maturity and a further Rs. 30 billion on the 364-day maturity.

At last week’s Treasury bill auction, the 91-day and 182-day bills continued to see considerable demand, with bids of Rs. 97.39 billion and Rs. 88 billion respectively, exceeding the offered amounts of Rs. 55 billion and Rs. 60 billion. The 91-day bill average dropped by 10 basis points to 15.29%, while the 182-day average remained stable, and the 364-day bill declined by 02 basis points to 12.94%. Total bids were 1.50 times greater than the total offered amount. The entire offered amount of Rs. 145 billion was raised in the first phase of the auction and a further Rs. 9.21 billion was raised at the second phase.

The total secondary market Treasury bond/bill transacted volume for 27 November 2023 was Rs. 4.45 billion. In money markets, the weighted average rates on overnight call money and Repo stood at 9.25% and 9.84% respectively while the net liquidity deficit stood at Rs. 31.07 billion yesterday.

The DOD (Domestic Operations Department) of Central Bank injected liquidity by way of an overnight auction for Rs. 14.52 billion at the weighted average rates of 9.21%. An amount of Rs. 38.88 billion was withdrawn from Central Banks SLFR (Standard Lending Facility Rate) of 10.00% while an amount of Rs. 22.33 billion was deposited at Central Banks SDFR (Standard Deposit Facility Rate) of 9.00%. 

Forex Market 

In the Forex market, the USD/LKR rate on spot contracts closed the day at Rs. 329.35/329.50 against its previous day’s closing level of Rs. 328.90/329.40. The total USD/LKR traded volume for 27 November was $ 26 million. 

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