Yields edge up marginally in dull trade ahead of weekly bill auction

Wednesday, 7 April 2021 00:00 - - {{hitsCtrl.values.hits}}

Liquidity increases

By Wealth Trust Securities

The dull momentum in bond markets continued yesterday as yields edged up marginally yesterday, mainly on the short end of the yield curve, ahead of the weekly T-bill auction due today. Limited amount of trades were seen on the maturities of 01.10.22, 15.12.22, 15.05.23, 01.09.23, and 15.11.23 at levels of 5.85%, 5.90%, 6.25%, 6.35% and 6.38% respectively.

The weekly bill auction due today will see a total amount of Rs. 45 billion on offer, consisting of Rs. 10 billion of the 91-day maturity, Rs. 15 billion of the 1820-day maturity and a further Rs. 20 billion of the 364-day maturity. At last week’s auction, weighted average yields on the 91-day and 182-day maturities increased by one and two basis points respectively to 5.05% and 5.10%, while all bids received on the 364-day maturity were rejected. The stipulated cut off rate on the 364-day maturity was increased by three basis points to 5.15% while the maximum yield rates of the 91-day and 182-day maturities will be decided below the level of the 364-day maturity at the auction. The total secondary market Treasury bond/bill transacted volume for 5 April was Rs. 3.7 billion.

In money markets, the net liquidity surplus increased to Rs. 122.31 billion yesterday as only an amount of Rs. 22.45 billion was withdrawn from Central Banks SLFR of 5.50% against its previous day of Rs. 62.18 billion. An amount of Rs. 144.76 billion was deposited at Central Banks SDFR of 4.50% while the weighted average rates on call money and repo was registered at 4.64% and 4.66% respectively.

USD/LKR

In the Forex market, the USD/LKR rate on the more active one-week forward contracts were seen closing the day at levels of Rs. 201/201.50 yesterday against its previous day’s closing level of Rs.200.50/201.50.

The total USD/LKR traded volume for 5 April was $ 73.52 million.

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