Secondary market bond yields continue to decline

Tuesday, 3 December 2013 01:33 - - {{hitsCtrl.values.hits}}

By Wealth Trust Securities The positive momentum in secondary bond markets continued yesterday as well as yields on the most liquid durations of two years (15.07.2015), two and a half years (01.04.2016), three and a quarter years (01.01.2017) and the two five years (i.e. 01.04.2018 and 15.08.2018) dipped to daily lows of 9.77%, 10.20%, 10.47%, 10.90% and 10.99% respectively in comparison to its previous day’s closing levels of 9.87/92, 10.18/25,

10.50/54, 10.94/98 and 11.03/05 as activity remained high. Furthermore a limited amount of activity was witnessed on the 15.07.17 maturity as well at levels of 10.75% to 10.85%. It was widely observed that the reason for the decrease in yields over the past few days was due to speculation of the outcome of the monitory policy meeting for the month of December. In secondary market bills the 364-day bill was quoted at levels of 10.50%-10.55%. In money markets, Overnight call money and repo rates continued to remain steady to average 7.79% and 7.07% respectively as surplus liquidity increased to a two month high of Rs. 42.83 billion yesterday. The Open Market Operations (OMO) department of the Central Bank was seen mopping up liquidity on a seven day basis for an amount of Rs. 20.00 billion at a weighted average of 7.44%. Rupee gains once again In forex markets, export conversions coupled with selling interest on forward dollar contracts saw the rupee gain most of its ground it lost over the past few days to close the day at Rs. 130.95/05 yesterday. The total USD/LKR traded volume for the previous day (29-11-13) stood at $ 66.73 million. Some of the forward dollar rates that prevailed in the market were 1-Month: Rs. 131.85; 3-Months: Rs. 133.30 and 6-Months: Rs. 135.40.