Secondary market bond yields edge up marginally ahead of weekly auction
Wednesday, 13 November 2013 00:01
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By Wealth Trust Securities
The upward trend in secondary market bond yields continued yesterday as a result of selling pressure of the regularly traded bonds such as the 1 April 2016, 1 January 2017 and the two 2018s (i.e. 1 April 2018 and 15 August 2018).
Moderate volumes of these maturities were seen changing hands at highs of 10.53%, 10.78%, 11.12% and 11.18% in comparison to the previous day’s closing levels of 10.40/50, 10.72/78, 11.05/07 and 11.13/18.
However, the yields dropped towards the end of the day to close at 10.52/58, 10.76/82, 11.10/13 and 11.16/22 respectively. In the mean time the two year maturities (i.e. 15 March 2015 and 1 September 2015) were seen trading at levels of 11.00% to 11.05% and 11.25% to 11.28% respectively.
With regard to bills, the May 2014 maturity was quoted at levels of 9.05% to 9.20%, the July 2014 at 9.45% to 9.55%, the September 2014 at 9.75% to 9.78% and the latest 364 day bill which matures on 7 November 2014 at 9.78% to 9.82%.
Today’s Treasury bill auction will have on offer a total amount of Rs. 7 b, of which Rs. 0.5 b consist of the 182 day bills and Rs. 6.5 b of the 364 day bills.
The weighted averages at last week’s auction declined for a seventh consecutive week to 8.94% and 9.82% respectively on the 182 day and 364 day maturities, whilst bids received for the 91 day bill were rejected.
Meanwhile in money markets, Overnight call money and repo rates remained steady to average 7.75% and 7.04% respectively despite money market liquidity decreasing marginally to Rs. 12.92 b. The Open Market Operations (OMO) department of the Central Bank continued to drain out an amount of Rs. 9.15 b on a seven day basis at a WAvg of 7.46% while a further amount of Rs. 3.77 b was deposited at its window rate of 6.50%.
Rupee remained steady
In Forex markets, the USD/LKR rate remained mostly unchanged to close the day at Rs.131.10/131.15. The total USD/LKR traded volume for the previous day (11-11-13) stood at US $ 38.95 million. Some of the forward dollar rates that prevailed in the market were one month – 132.00; three months – 133.57 and six months – 135.
