Secondary market activity picks up ahead of weekly T-bill auction
Wednesday, 10 July 2013 00:08
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By Wealth Trust Securities
Activity in secondary bond markets picked up yesterday ahead of today’s weekly Treasury bill auction as yields dipped marginally.
At today’s auction a total amount of Rs. 12 b is on offer for a fifth straight week with the offered amount on the 364 day maturity increasing by Rs. 1 b to Rs. 10 b while Rs. 1 b each is been offered on the 182 day and 91 day maturities.
At last week’s auction the weighted averages (WAvg) on the 182 day and 364 day maturities remained unchanged at 9.70% and 10.66% respectively while the WAvg on the 91 day dipped by one basis point to 8.65%.
Once again bond activity centered on the liquid two five year maturities (i.e. 1 April 2018 and 15 August 2018) as its yields were seen dipping to intraday day lows of 11.34% and 11.40% respectively against its days opening levels of 11.37% and 11.45%.
In addition active two way quotes were seen on the two-year and three-year maturities as well at levels of 10.80/90 and 11.00/05 respectively. Furthermore buying interest on the shorter leg of the yield curve saw the 182 day bill close the day at levels of 9.70/80 while the 364 day bill was seen at levels of 10.57/60.
Meanwhile an bond auction in nearly a month will see amounts of Rs. 2 b, Rs. 3 b and Rs. 5 b been offered on 11 July for durations of five years, eight years and 20 years respectively in line with the Rs. 64 b bond maturity due on 15 July 2013.
The weighted averages on overnight call money and repo rates continued to remain steady at 8.71% and 8.16% respectively as surplus liquidity remained high at Rs. 29.85 b yesterday.
The Open Market Operations (OMO) department of Central Bank was seen mopping up an amount of Rs. 26.58 b on an overnight basis at a weighted average of 7.80% by way of a repo auction while a further amount of Rs. 3.27 b was seen been deposited at CBSL’s repo window of 7%.
Rupee remains steady
The USD/LKR spot rate continued to remain steady for a sixth consecutive day at Rs. 130.60/70 yesterday while spot next contracts were active at levels of Rs. 130.95/131.05. The total USD/LKR traded volume for the previous day (8 July 2013) stood at US$ 82.95 million.
