Treasury Bill auction draws over Rs. 22 b for second consecutive week

Thursday, 6 March 2014 00:31 - - {{hitsCtrl.values.hits}}

By Wealth Trust Securities Continuing with the recent trend, the accepted amount at yesterday’s weekly Treasury bill auction exceeded its initial total offered amount for a sixth consecutive week. It was the 364 day bill which attracted the maximum number of successful bids amounting to Rs. 18.28 billion followed by the 182 day bill for Rs. 7.79 b, which in turn saw authorities accepting in total an amount of Rs. 27.07 billion at the auction against its initial total offered amount of Rs. 18 billion.

This was the second straight week that the total accepted amount exceeded Rs. 22 billion and the first instant in five weeks that it exceeded Rs. 27 b. The weighted averages (WAvgs) reflected declines of one basis point (bp) each on the 91 day and 182 day bills to levels of 6.71% and 6.88% while the WAvg on the 364 day bill remained unchanged for the first time in four weeks to record a level of 7.07%. However in secondary bond markets, yields increased for a third consecutive day mainly on the liquid two 2018 maturities (i.e. 1 April 2018 and 15 August 2018) as it was seen hitting intraday highs of 8.93% and 9.01% respectively in comparison to its previous day’s closing levels of 8.86/87 and 8.95/00. In addition the maturities of 15 July 2017, 15 January 2019, 1 November 2019 and 1 May 2021 were seen changing hands within the range of 8.45% to 8.60%, 9.05% to 9.10%, 9.20% to 9.35% and 10.00% to 10.05% respectively as well. Furthermore in secondary bill markets, May 2014 bills were traded within the range of 6.70/75, June within 6.72/77, August within 6.82/55 and November within 6.90% to 6.95% while the latest 364 day bill was at 7.04/10 post auction. Meanwhile in money markets, the Open Market Operations (OMO) department of Central Bank was seen mopping up an amount of Rs. 17.65 b on a two day basis at a WAvg of 6.58% by way of a repo auction as surplus liquidity stood at Rs. 23.05 b yesterday. Overnight call money and repo rates remained steady to average 6.70% and 6.33% respectively. Rupee gains marginally

The USD/LKR rate appreciated marginally yesterday on the back of weakening importer demand to close the day at levels of Rs. 130.60/63 as volume traded moderated. The total USD/LKR traded volume for the previous day (4 March 2014) stood at US$ 78.61 million. Some of forward dollar rates that prevailed in the market were one month – 131.22; three months -132.17; and six months – 133.72.