Secondary market bond yields edge up as policy rates held steady
Tuesday, 12 November 2013 01:38
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By Wealth Trust Securities
Secondary market bond yields increased yesterday as Central Bank held its policy rates unchanged at 6.50% and 8.50% at its monthly monetary policy meeting for the month of October.
Activity mainly surrounded the liquid maturities of 1 April 2016, 1 January 2017 and the liquid two 2018s (i.e. 1 April 2018 and 15 August 2018) as it was seen hitting intraday highs of 10.50%, 10.75%, 11.06% and 11.16% respectively from its opening levels of 10.40/50, 10.70/75, 10.98/03 and 11.07/12.
Secondary market bills saw May 2014 bills been quoted within the range of 9.00% to 9.10% and the 364 day bill within 9.78% to 9.82% once again.
Meanwhile in money markets, Overnight call money and repo rates remained steady to average 7.76% and 7.00% respectively as money market liquidity remained at a surplus of Rs. 24.48 b yesterday.
The Open Market Operations (OMO) department of Central Bank drained out an amount of Rs. 21.71 b on a seven day basis at a WAvg of 7.46% while a further amount of Rs. 2.77 b was deposited at its window rate of 6.50%.
Rupee remains steady
In Forex markets, the USD/LKR rate on spot contracts remained steady to close the day at levels of Rs.131.05/08 on the back of moderate volumes. The total USD/LKR traded volume for the previous day (8 November 2013) stood at US$ 40.75 million.
Some of the forward dollar rates that prevailed in the market were one month – 131.87; three months -133.49; and six months – 135.64.
