Weekly Treasury bill averages record steep increases

• Inflation at 64.3%

By Wealth Trust Securities 

The weekly Treasury bill auction conducted yesterday saw its weighted averages increase steeply, led by the 91 day maturity galloping by 238 basis points or 2.38% to an historical high of 32.89%. The 182 day maturity recoded an increase of 177 basis points or 1.77% to 31.28% followed by the 364 day maturity by 67 basis points or 0.67% to 30.50%. Only 73.38% or Rs. 49.53 billion was taken in total against a total offered amount of Rs. 67.5 billion.

The bids to offer ratio increased to 1.42:1 while phase 2 of the auction will be opened on the 182 day and 364 day maturities at its weighted average rates until close of the business of the day prior to settlement (i.e. 3:30 p.m. on 01.09.22). 

However, activity in the secondary bond market was at a halt for a third consecutive day due to all market participants continuing to be on the side-lines.

Meanwhile, the Colombo Consumer Price Index (CCPI; Base 2013=100) for the month of August increased for an eleventh consecutive month to a high of 64.3% on its point to point against its previous month’s figure of 60.8%. The annual average also increased to 28.0% against 23.1%.

In money markets, the weighted average rates on overnight REPO stood at 15.50% while an amount of Rs. 799.71 billion was withdrawn from Central Bank’s Standard Deposit Facility Rate (SDFR) of 15.50%. The net liquidity deficit stood at Rs. 474.16 billion yesterday as an amount of Rs. 325.55 billion was deposited at Central Bank’s Standard Lending Facility Rate (SLFR) of 14.50%. No Call money transactions were reported.

Forex market 

In the forex market, the middle rate for USD/LKR spot contracts was at Rs. 361.1480 yesterday against its previous day’s level of Rs. 361.2900.

The total USD/LKR traded volume for 30 August was $ 113.80 million.  

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