Secondary market bond yields increase ahead of weekly Treasury bill auction
Wednesday, 3 September 2014 00:09
-
- {{hitsCtrl.values.hits}}
By Wealth Trust Securities
Activity in secondary bond markets picked up yesterday as yields were seen increasing for the first time in four days, mainly on the maturities of 1 July 2019, 1 May 2021 and 1 July 2022 to intraday highs of 7.52%, 8.08% and 8.20% respectively against its days opening lows of 7.28%, 7.88% and 7.98%.
In addition, a considerable amount of activity was witnessed on the two 2018 maturities (i.e. 1 April 2018 and 15 August 2018) within the range of 7.20% to 7.35% and on the 01.01.2024 maturity within the range of 8.00% to 8.20% as well.
All this was ahead of today’s weekly Treasury bill auction, at where a total amount of Rs. 8 Billion will be on offer in comparison to its previous week’s total offered amount of Rs. 12 b, comprising of Rs. 1 b on the 182 day maturity and Rs. 7 b on the 364 day maturity. Interestingly, the 91 day maturity will not be on offer for the first time in 17 weeks. At last week’s auction, weighted averages remained unchanged on the 182 day and 364 day maturities at 6.28% and 6.30% respectively, while all bids were rejected on the 91 day maturity for a second consecutive week.
Meanwhile in money markets, overnight call money and repo rates remained steady to average 6.70% and 6.52% as surplus liquidity in money markets remained high at Rs 51.01 Bn. The total surplus amount was deposited at Central Bank’s Standing Deposit Facility Rate (SDFR) of 6.50% as no auctions under its Open Market Operations (OMO) were conducted for a second consecutive day yesterday.
Rupee lost ground marginally
Meanwhile in Forex markets yesterday, the USD/LKR rate closed the day marginally lower at Rs. 130.20/22 against its previous day’s closing of 130.17/22 on the back of importer demand outweighing inward remittances and export conversions. The total USD/LKR traded volumes for 1 September stood at $ 33.95 million.
Some of the forward dollar rates that prevailed in the market were: one month – 130.64; three months – 131.24; and six months – 132.26.
