Weekly weighted averages crash to all-time lows

• Bond yields continue to free fall

By Wealth Trust Securities

The weekly Treasury bill auctions held yesterday saw its weighted averages on all three maturities crash to all-time lows, surpassing its previous lows seen during the period of September to December 2014. The market favorite 364 day bill recorded the sharpest decline of 96 basis points to 5.66%, dipping below the 6.00% level for the first time since 17 December 2014. The 91 day and 182 day bills registered dips of 80 and 77 basis points to 5.50% and 5.53% respectively. The total offered amount of Rs. 23 billion was successfully accepted at the auction as its bids to offer ratio stood at 4.75:1. 

In the secondary bond market yesterday, the increasing trend in yields witnessed during morning hours of trading reversed swiftly and continued to dip leading to the auction and subsequent to its outcome. The yields on the liquid maturities of 15.12.22, 15.01.23, 15.09.24, 01.05.25, 01.02.26 and 15.10.27 dipped to intraday lows of 5.90%, 6.04%, 6.62%, 6.80%, 6.95% and 7.11%. respectively against its days opening highs of 6.20% each, 7.00%, 7.18%, 7.25% and 7.23% Furthermore, maturities of 2021s (i.e. 01.08.21, 15.10.21 & 15.12.21), 2023s (i.e. 15.07.23 & 01.09.23), 2024s (i.e. 01.10.24, 15.06.24 & 01.08.24) and 01.08.25 were seen changing hands within the range of 5.55% to 6.10%, 6.20% to 6.55%, 6.55% to 7.00% and 7.00% 

respectively.

The total secondary market Treasury bond/bill transacted volume for 23 June was Rs. 19.19 billion. 

In money markets, the weighted average rates on overnight call money and repo were recorded at 5.51% and 5.64% respectively as the overnight net liquidity surplus in the system stood at a high of Rs. 207.39 billion yesterday. The DOD (Domestic Operations Department) of Central Bank refrained from conducting any auction.

Rupee remains mostly unchanged 

In Forex markets, the USD/LKR on spot contracts remained mostly unchanged yesterday to close the day Rs. 186.60/70.

The total USD/LKR traded volume for 23 June was $ 59.43 million. 

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