Treasury bond yields increase ahead of Treasury bill auction

By Wealth Trust Securities

The start of a fresh and shortened trading week saw secondary market bond yields increasing yesterday as the liquid maturities of 01.05.24 and 15.05.26 hit intraday highs of 32.00% and 30.50% respectively against its previous day’s closing levels of 31.00/25 and 29.50/75.

Today’s weekly Treasury bill auction, conducted a day prior due to a shortened trading week, will have in total an amount of Rs. 85 billion on offer, an increase of Rs. 5 billion in comparison to its previous week’s total offered amount. This will consist of Rs. 40 billion of the 91-day maturity, Rs. 25 billion of the 182-day maturity and a further Rs. 20 billion of the 364-day maturity. At last week’s auction, weighted average rates decreased across the board for a third consecutive week by 01, 18 and 6 basis points respectively to 32.91%, 32.27% and 29.46%. The total offered amount of Rs. 80.00 billion was accepted at the 1st phase of the auction while a further amount of Rs. 2.00 billion was raised at its 2nd phase.

The total secondary market Treasury bond/bill transacted volume for 2 December was Rs. 10.17 billion.  

In money markets, the net liquidity deficit stood at Rs. 243.86 billion yesterday as an amount of Rs. 327.58 billion was deposited at Central Bank’s SDFR (Standard Deposit Facility Rate) of 14.50% against an amount of Rs. 571.45 billion withdrawn from Central Bank’s SLFR (Standard Lending Facility Rate) of 15.50%. The weighted average rate on overnight call money was registered at 15.50% while no transactions were report on overnight Repo.

Forex market 

In the forex market, the middle rate for USD/LKR spot contracts appreciated very marginally to Rs. 363.1767 yesterday against its previous day’s closing level of Rs. 363.1900.

The total USD/LKR traded volume for 2 December was $ 40.15 million. 

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