Secondary market bond yields edge up further ahead of T.Bill auction
Wednesday, 5 March 2014 00:26
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By Wealth Trust Securities
Activity in secondary bond markets picked up yesterday, as yields edged up for a second consecutive day, with the liquid two 2018 maturities (i.e. 01.04.2018 and 15.08.2018) increasing to intraday highs of 8.90% and 8.98% respectively during morning hours of trading. However buying interest at these levels curtailed the upward movement as it closed the day at levels of 8.86/87 and 8.95/00 respectively.
In addition, the 2019 maturities (15.01.2019 and 01.07.2019) and the 01.05.2021 maturity were seen changing hands within the range of 8.97% to 9.00% and 9.95% to 10.00% respectively as well. Meanwhile, today’s auction will have on offer Rs. 1 billion on the 91-day, Rs. 5 billion on the 182-day and Rs. 12 billion on the 364-day maturities. This is in comparison to last week’s total offered amount of Rs. 12 billion at where weighted averages declined by 1 basis point (bp) each on the 182-day and 364-day maturities to 6.89% and 7.07% respectively, while the 91-day decreased by 3 bp to 6.72%. In secondary bill markets, the 364-day bill was seen been quoted at levels of 7.04/10.
Overnight call money and repo rates remained steady to average 6.93% and 6.34% respectively as surplus liquidity remained high at Rs. 30.56 billion yesterday. The Open Market Operations (OMO) department of Central Bank was seen mopping up an amount of Rs. 20.64 billion on an overnight basis at a weighted average (WAvg) of 6.55% by way of a repo auction while a further amount of Rs. 9.92 billion was seen been deposited at CBSL’s Standing Deposit Facility Rate (SDFR) of 6.50%. Furthermore, the OMO department was seen conducting a term repo auction for an amount of Rs. 15 billion for a period of 30 days at where it drained out an amount of Rs. 13.53 billion at a WAvg’s of 6.75%.
