Secondary market Treasury bond yields edge up marginally

By Wealth Trust Securities

Activity in secondary bond markets picked up yesterday as selling pressure saw its yields close the day marginally higher in comparison to Thursday’s closing levels.

Once again it was the two liquid five-year maturities (i.e. 01 April 2018 and 15 August 2018) which reflected the most amount of activity as its yields edged up in the early hours of trading to intraday highs of 11.16% and 11.20% respectively and dipped once again to levels of 11.12% and 11.17% as buying interest set in at these levels. Furthermore the eight year maturity was seen been quoted at levels of 11.55/65% while the three-year maturity was quoted at 10.90% to 11.00%.

Given below are the closing, secondary market yields for the most frequently traded maturities,

Surplus liquidity in money markets remained mostly unchanged at Rs. 7.15 billion as the Central Bank continued to refrain from conducting any Open market Operation (OMO) auctions yesterday. An amount of Rs. 7.42 billion was deposited at Central Bank’s repo window rate of 7.00% and Rs. 0.26 billion was accessed from its reverse repo window rate of 9.00%. Overnight call money and repo rates remain steady to average 9.00% and 8.41% respectively.

 Rupee holds steady

The rupee traded within a tight band of Rs. 126.30 to Rs. 126.40 throughout the day as volumes traded moderated. The total USD/LKR volume for the previous day stood at US$ 36.20 million. Some forward dollar rates that prevailed in the market were one-month: Rs. 127.30, three-months: 128.88 and six-months: 131.53.