Bond yields up for seventh consecutive day ahead of TBill auction

Wednesday, 20 August 2014 01:02 - - {{hitsCtrl.values.hits}}

By Wealth Trust Securities Activity in secondary bond markets remained moderate yesterday as yields continued to edge up with the liquid maturities of the two 2018’s (i.e. 1 April 2018 and 15 August 2018), the 1 July 2019 and the 1 July 2022 increasing to intraday highs of 7.40%, 7.70%, 7.60% and 8.60% respectively against its previous day’s closing levels of 7.25/27, 7.36/43, 7.42/50 and 7.32/38. However, buying interest at these levels curtailed any further upward movement ahead of today’s weekly Treasury bill auction. In addition, the maturities of 15 May 2017 and 1 May 2021 were seen changing hands within the range of 7.00% to 7.45% and 8.20% to 8.40% respectively as well. Meanwhile today’s auction will have on offer Rs. 1 billion each on the 91-day and 182-day maturities while Rs. 8 billion will be on offer on the 364-day maturity. At last week’s auction, weighted averages continued to decline, with the 364-day bill dipping the most by 14 basis points (bp) to 6.31% while the 91-day and 182-day bills reflected dips of 09 bp each to 6.19% and 6.30% respectively. In money markets, overnight call money and repo rates remained steady to average 6.70% and 6.54% respectively as overall surplus liquidity stood at Rs. 33.55 billion yesterday, with the total amount been deposited at CBSL’s Standing Deposit Facility Rate (SDFR) of 6.50%. Rupee trades within a narrow band The dollar/rupee rate continued to trade within a narrow band of Rs. 130.13-Rs. 130.19 yesterday. The total USD/LKR traded volumes for 18 August stood at $ 55.65 million. Some of the forward dollar rates that prevailed in the market were 1 month: Rs. 130.50, 3 months: Rs. 131.13 and 6 months: Rs. 132.18.

Rupee firmer on exporter dollar sales

REUTERS: The rupee ended firmer on Tuesday as exporter dollar sales outpaced importer demand for the greenback, though broader gains were capped as state banks bought dollars to prevent any sharp gains, dealers said. The rupee ended at Rs. 130.13/14 per dollar after touching Rs. 130.17, slightly firmer from Monday’s close of Rs. 130.15/16. It had hit a two-week low of Rs. 130.26 per dollar on Wednesday. Two state banks, through which the central bank usually intervenes in the market, bought dollars at Rs. 130.13, two cents below Monday’s rate, to prevent sharp gains and excessive volatility, dealers said. “There was demand for dollars with the stock-related dollar outflow speculation. But it ended firmer,” said a currency dealer. The island nation’s bourse saw a net outflow of Rs. 4.52 billion ($ 34.7 million) on Tuesday, the highest net foreign selling since 25 March, 2010. Yields on five-year bonds were trading at 7.48/58%, 13 basis points (bps) higher than on Monday, dealers said.