Wednesday Sep 25, 2024
Wednesday Sep 25, 2024
Monday, 30 May 2022 02:38 - - {{hitsCtrl.values.hits}}
By Wealth Trust Securities
Activity in the secondary bond market moderated during the week ending 27 May with most market participants seen on the sidelines ahead of the Treasury bond auctions due today.
Limited trades were witnessed during the week on the liquid 01.06.25 maturity at levels of 22.58% to 22.665% while July to August 2022 maturities in secondary bills changed hands at levels of 20.00% to 22.50%.
The primary Treasury bond auctions due today will see a total volume of Rs. 40 billion on offer consisting of Rs. 15 billion of a 01.06.2025 maturity and Rs. 25 billion of a new 15.01.2028 maturity. At the auctions conducted on 12 May, an amount of Rs. 35.72 billion was taken up in total against a total offered amount of Rs. 35 billion while weighted average rates were recorded at 23.53% and 22.69% on the 01.06.2025 and 01.05.2027 maturities respectively.
The second Phase of the auction was opened for the 01.06.2025 maturity while a direct issuance window of 20% of the offered amount was opened on the 01.05.2027 maturity.
The weekly Treasury bill auction conducted during the week saw the weighted average rates decreasing across all three maturities for the first time in three weeks while the auction was fully subscribed for the first time in three weeks as well.
Further, the National Consumer Price Index (NCPI) or inflation for the month of April increased for a seventh consecutive month to 33.8% on its point to point while its annual average increased as well to 13.0%.
The foreign holding in rupee bonds increased marginally to Rs. 2.74 billion for the week ending 25 May while the daily secondary market Treasury bond/bill transacted volumes for the first four trading days of the week averaged Rs.19.63 billion.
In money markets, the total outstanding liquidity deficit at the end of the week increased to Rs. 718.12 billion against its previous weeks Rs. 676.38 billion while CBSL’s holding of Gov. Securities decreased to Rs. 1,971.46 against its previous weeks closing levels of Rs. 1,974.13 billion. The weighted average rates on overnight call money and repo were 14.50% each for the week.
Rupee middle rate appreciates further
In the Forex market, the middle rate for USD/LKR spot contracts appreciated further during the week to Rs. 359.25 against its previous weeks closing of Rs. 369.475.
The daily USD/LKR average traded volume for the four three trading days of the week stood at $ 21.96 million.
(References: Central Bank of Sri Lanka, Bloomberg E-Bond trading platform, Money broking companies)
