Treasury bond averages dip below secondary market yields

By Wealth Trust Securities

The weighted averages at yesterday’s Treasury bond auctions decreased considerably, well below its respective secondary market yields. The 4.02 year maturity of 01.03.2021, the 7.07 year maturity of 01.08.2024 and the 9.07 year maturity of 01.08.2026 recorded weighted averages of 11.94%, 11.98% and 12.11% respectively in comparison to its secondary market pre-auction yields of 11.90/00, 12.20/30 and 12.30/40. A total amount of Rs. 55.5 billion was accepted againts its total offered amount of Rs. 57 billion.

Nevertheless, activity in secondary bond markets remained rather dull yesterday as auction results were announced nearing the close of the trading day. 

In money markets, the Open Market Operations (OMO) Department of Central Bank drained out an amount of Rs. 35.51 billion on an overnight basis at a weighted average of 7.42% by way of a repo auction as the net surplus liquidity increased to almost a ten month high of Rs. 43.20 billion yesterday. The overnight call money and repo rates remained steady to average at 8.42% and 8.66% respectively.

Rupee depreciates marginally

The rupee rate on the active one week forward contract depreciated marginally yesterday to close the day at Rs. 150.05/15 against its previous day’s closing levels of Rs. 149.90/10 on the back of renewed importer demand.

The total USD/LKR traded volume for 23 November 2016 was $ 57.71 million.

Some of forward USD/LKR rates that prevailed in the market were one month - 150.60/70; three months - 152.15/35 and six months - 154.35/70.