IMF comments sees secondary market bond yields increase further

By Wealth Trust Securities

The IMF comments on interest rates led to yields increasing further on secondary market bonds yesterday. Two-way quotes on the most sort after two maturities of 15.09.19 and 01.05.20 were seen increasing to levels of 8.95/05 and 9.05/15 respectively subsequent to hitting intraday highs of 9.00% and 9.05% in comparison to its previous day’s closing levels of 8.75/85 and 8.85/95. In addition, two way quotes on all other maturities were seen increasing as well. The same trend was witnessed in secondary market bills as well, with the 91 day and 364 day bills been offered at levels of 6.10% and 6.95 respectively. 

Meanwhile, in money markets, the OMO department of Central Bank was seen mopping up an amount of Rs.10.75 billion through a 10 day repo auction at a weighted average yield of 6.16% yesterday as surplus liquidity in the market increased to Rs.94.38billion. The overnight call money and repo rates remained steady to average 6.31% and 5.91% respectively.

Rupee loses ground once again

Meanwhile, in Forex markets yesterday, the USD/LKR rate on spot contracts dipped marginally to close the day at Rs.143.25/30 in comparison to previous day’s closing of Rs.143.18/25. The total USD/LKR traded volume for the 09th of December 2015 was US $ 67.75 million. 

Some of the forward USD/LKR rates that prevailed in the market were 1 Month - 143.65/75; 3 Months - 144.50/65 and 6 Months - 145.50/80.