Yields remain mostly unchanged ahead of weekly bill auction

Wednesday, 20 June 2018 00:00 - - {{hitsCtrl.values.hits}}

By Wealth Trust Securities

Secondary bond market yields remained mostly unchanged yesterday, baring the 10-year maturity, ahead of the weekly Treasury bill auction.

Trades were witnessed on the short to mid-term maturities of 15.11.18, 01.07.19, 01.03.21 and 01.10.22 within the range of 8.80% to 8.82%, 9.40% to 9.41%, 9.95% and 10.35% respectively. However, the yield on the 10-year maturity of 1.09.28 was seen increasing to a daily high of 10.a78% against its day’s opening low of 10.70%.

In the secondary bill market, September and November 2018 maturities were traded at levels of 8.30% and 8.70% respectively while January, February, March and May 2019 maturities changed hands at levels of 9.05% to 9.20%, 9.20%, 9.25% and 9.27% to 9.40%.

At today’s weekly Treasury bill auction, the total offered amount will increase to a four-week high of Rs. 14 billion consisting of Rs. 2 billion on the 91 day, Rs. 3 billion on the 182-day and a further Rs. 9 billion on the 364 day maturities respectively.

At last week’s auction, the weighted average on the 364-day bill decreased by five basis points to 9.44% while weighted averages on the 91-day and 182-day maturities remained unchanged at 8.34% and 8.87% respectively.

The total secondary market Treasury bond transacted volume for 18 June was Rs. 3.95 billion.

Given below are the closing, secondary market yields of the most frequently traded T-bills and bonds.

In money markets, the overnight call money and repo rates averaged 8.43% and 8.45% respectively as the net deficit in the system stood at Rs. 19.42 billion yesterday. The OMO Department of the Central Bank of Sri Lanka infused an amount of Rs. 25.00 billion at a weighted average yield of 8.50%, by way of an overnight reverse repo auction.

Rupee losses marginally

The USD/LKR rate on spot contracts depreciated marginally to close the day at Rs. 159.95/05 against the previous day’s closing levels of Rs. 159.90/95 on the back of importer dollar demand.

The total USD/LKR traded volume for 18 June was $ 65 million.

Given below are some of the forward USD/LKR rates that prevailed in the market.

1 Month - 160.75/85

3 Months - 162.30/50

6 Months - 164.70/90