Weekly averages continue to edge up

• Bond yields increase on improved activity levels

By Wealth Trust Securities

The weighted average yield of the 91-day bill was seen increasing by 14 basis points to 8.63% at its weekly auction conducted yesterday while weighted average yields on the 182-day and 364-day bills increased by 11 and seven basis points respectively to 8.55% each. 

The total offered amount of Rs. 80.5 billion was fully met as an amount of Rs. 77.39 billion was accepted on the 91-day maturity alone against its offered amount of Rs. 30 billion. The bids-to-offer ratio increased to 2.42:1. 

The secondary bond market became active yesterday as yields were seen increasing during morning hours of trading. The maturities of 15.06.24 and 2025’s (i.e., 15.03.25 & 01.05.25) hit highs of 10.43%, 11.30% and 11.41% respectively. In addition, maturities of 15.03.24 and 01.08.25 changed hands at levels of 10.25% and 11.29% to 11.30% respectively as well.

The total secondary market Treasury bond/bill transacted volume for 25 January was Rs. 2.28 billion.   

In money markets, the Domestic Operations Department (DOD) of the Central Bank of Sri Lanka was seen draining out an amount of Rs. 40.15 billion by way of an overnight repo auction at a weighted average rate of 6.49%, while an amount of Rs. 67.15 billion was deposited at Central Banks SDFR (Standard Deposit Facility Rate) of 5.50%. The net liquidity deficit was registered at Rs. 466.49 billion yesterday as an amount of Rs. 573.80 billion was withdrawn from Central Banks SLFR (Standard Lending Facility Rate) of 6.50%. The weighted average rates on overnight call money and repo remained mostly unchanged at 6.47% and 6.50% respectively.

USD/LKR   

In the Forex market, the USD/LKR rate on spot contracts traded at a level of Rs. 203 while the overall market remained inactive yesterday.

The total USD/LKR traded volume for 25 January was $ 85 million.   

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