Upward trend in weekly averages continue

• Total accepted amount dips to 14-week low
• Secondary market bond yields continue to increase 

By Wealth Trust Securities

The upward trend in the weekly weighted averages continued at yesterday’s weekly Treasury bill auction for a second consecutive week as the degree of increase was seen increasing as well. 

The 364 day bill recorded the sharpest increase of 22 basis points to 9.32% followed by the 182 day bill by 7 basis points to 9.08%. 

Interestingly, the total accepted amount dipped to a fourteen week low of Rs.13.45 billion against its total offered amount of Rs.20.5 billion as the bid to offer ratio was seen dipping to a seven-week low of 1.59:1 as well.

The secondary bond market yields were seen increasing further yesterday with the maturities of 01.05.20, 01.08.21 and 01.08.25 hitting highs of 10.00%, 10.15% and 10.55% respectively against its previous day’s closing levels of 9.75/95, 10.00/05 and 10.35/45 on the back of continued selling interest. 

The total secondary market Treasury bond/bill transacted volumes for 2 October was Rs.5.18 billion.

In money markets, The OMO Department of the Central Bank of Sri Lanka was seen draining out an amount of Rs.8.02 billion on an overnight basis by way of a repo auction at a weighted average of 7.26% as the net surplus liquidity in the system stood at Rs.19.76 billion. The overnight call money and repo rates averaged 8.11% and 7.96% respectively.

Rupee losses further 

In the Forex market, the USD/LKR spot rate was seen depreciating further yesterday, to close the day at Rs.153.22/28 against its previous day’s closing level of Rs.153.10/20 on the back of continued importer demand. 

The total USD/LKR traded volume for the 02nd of October 2017 was $ 29.50 million. 

Given are some forward USD/LKR rates that prevailed in the market: one month – 154.00/10; three months – 155.75/85; six months – 157.65/75.