Tuesday, 25 November 2014 01:01
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By Wealth Trust Securities
The increasing trend witnessed in secondary bond markets during the latter part of last week driven by uncertainties eased off marginally yesterday as the spread on two way quotes narrowed.
The yields on the liquid maturities of 1 May 2021, 1 July 2022 and 1 January 2024 narrowed down to 7.90/00, 8.13/20 and 8.30/50 respectively against its Friday’s closing levels of 7.80/50, 8.20/60 and 8.30/80 as a limited amount of activity was witnessed on these maturities within the range of 7.95% to 8.05%, 8.10% to 8.20% and 8.30% to 8.40%.
In addition, yields on the five-year maturity of 01.07.2019 narrowed down as well, to a level of 7.25/35 with it changing hands at levels of 7.30%. However, overall activity in the market moderated yesterday as most market participants were seen on the sidelines due to the prevailing uncertainties.
Surplus liquidity on an overnight basis, stood at Rs.11.25 billion yesterday with an amount of Rs. 4.22 b being mopped up from the system by way of a four day Repo auction conducted by the Open Market Operations (OMO) department of the Central Bank at a weighted average of 5.96%. The overnight call money and repo rates averaged at 6.00% and 5.51% respectively.
Rupee depreciates
In Forex markets, the dollar/rupee (USD/LKR) rate on spot next contracts depreciated to a daily low of Rs. 131.35 and closed the day at levels of Rs. 131.25 / 131.40 yesterday, in comparison to its previous week’s closing level of Rs. 131.20 /30 on the back of demand continuing to outweigh supply.
Some of the forward dollar rates that prevailed in the market were: one month – 131.78; three months – 132.90; and six months – 134.13.
