Secondary market bond yields edge up once again

Friday, 28 June 2013 04:12 - - {{hitsCtrl.values.hits}}

By Wealth Trust Securities Selling interest in secondary bond markets saw yields edge up once again yesterday with the two liquid five year maturities (i.e. 1 April 2018 and 15 August 2018) continuing to dominate activity. Its yields were seen increasing intraday by 18 basis points (bp) and 15 bp respectively from lows of 11.22% and 11.32% to highs of 11.42% and 11.47%. In addition, a limited amount of activity was witnessed on the eight year maturity within the range of 11.55% to 11.60%. However in contrast to the secondary bond markets, yields on secondary market bills dipped mainly on the 364 day maturity as it was seen changing hands within the

range of 11.60% to 11.64%. In money markets yesterday, overnight call money and repo rates remained steady to average 8.55% and 8.15% respectively as surplus liquidity increased to Rs. 13.45 b. The Open Market Operations (OMO) department of the Central Bank was seen mopping up an amount of Rs. 11.62 b from the system at a weighted average of 7.79% on an overnight basis by way of a repo auction while it announced plans of mopping up a further Rs. 15 b in total in the 01st of July by way of outright sales of Treasury bills for durations of 39 days and 46 days. Rupee continues its slide The USD/LKR rate continued to drop yesterday to a low of Rs 130.65 on the back of importer demand and foreign rupee bond holders hedging their exchange rate risk. This was against its opening level of Rs. 129.60/70 and it was seen closing the day at Rs. 130.65/80. The total USD/LKR volume for the previous day (26 June 2013) stood at US$ 93.40 million. Given below are some forward dollar rates that prevailed in the market: one month – 131.45; three months – 133; and six months – 134.80.