Secondary market bond activity comes to a standstill

By Wealth Trust Securities

The significant increase in inflation for May saw secondary bond and bill markets turn bearish yesterday as activity dried up. Active two way quotes were mainly seen on the liquid two five year maturities (i.e. 1.4.2018 and 15.8.2018) at levels of 11.10/12 and 11.17/20 and the eight year maturity at levels of 11.50/54.

Overnight call money and repo rates remained steady to average 9.00% and 8.35% respectively as surplus liquidity in money markets increased to Rs. 18.61 billion yesterday. The Central Bank continued to refrain from conducting any Open Market Operations (OMO).

Rupee dips marginally in intraday trading 

In forex markets, the USD/LKR rate dipped marginally to an intraday low of Rs. 126.60 yesterday on the back of importer led demand before closing the day at Rs. 126.52/55 once again. The total USD/LKR volume for the previous day (31 May) stood at US$ 35.35 million.