Central Bank’s borrowing costs decrease across the board

As anticipated, Central banks borrowing costs dipped considerably at its weekly Treasury bill auction held yesterday. The market favourite 182 day maturity reflected the sharpest weekly decline of 34 basis points (bp) on its weighted average while the 364 day maturity dipped by 28 bp. Furthermore the 91 day maturity reflected a decline of 11 bp as well as an total amount of Rs 11.1 Bn was accepted out of an total offered amount of Rs 10 Bn.

Given below are the details of the auction,

In Secondary bond markets, yields dipped across the yield curve as volumes traded remained very high. The five year bond reflected the sharpest decline of 48 bp to an intraday low of 13.30% in comparison to its previous day’s closing levels while the four year bond dipped by 30 bp to an low of 13.25%. Furthermore in secondary market Treasury bills the 91 day, 182 day and 364 day maturities were seen been traded at 10 bp, 22 bp and 17 bp below its weighted averages. Given below are the closing, secondary market yields for the most frequently traded maturities,

 Meanwhile in money markets, surplus liquidity continued to be in the negative for a fifth consecutive day but an a reduced deficit of Rs (1.647 Bn) yesterday as Central bank injected an amount of Rs 2 Bn into the system through its Open Market Operations (OMO) at a weighted average of 9.688%. This in turn helped keep overnight call money and repo rates steady to average 10.56% and 9.64% respectively.

In Forex markets, the rupee remained stable within the range of Rs 130.95 to Rs 131.05 yesterday. The USD/LKR volume for 25/09/12 was US $ 54.16 million.  Given below are some forward dollar rates that prevailed in the market, 1 Month - 132.29; 3 Months134.67 and 6 Months- 138.19. Courtesy Wealth Trust Securities