Weekly averages remain steady for first time in 49 weeks

Thursday, 28 August 2014 00:00 - - {{hitsCtrl.values.hits}}

The weighted averages (WAvg) at the weekly Treasury bill auction remained steady against its previous week’s WAvgs for the first time in 49 weeks as the total accepted amount increased to Rs. 8.7 billion against its previous week’s total accepted amount of Rs. 4.3 b. All bids for the 91 day maturity were rejected for a second consecutive week with the 364 day maturity representing 84.75% of the total accepted amount.

However, contrary to the outcome of the primary auction, secondary market bond yields were seen increasing once again yesterday, mainly on the longer end of the yield curve while yields on the shorter end of the curve was seen decreasing. On the longer end of the curve, activity was mainly seen on the 1 July 2019 and the 1 May 2021 maturities as its yields were seen increasing to intraday highs of 7.80% and 8.65% respectively against its opening lows of 7.75% and 8.40% while on the shorter end of the curve, buying interest on the 1 November 2015 and the 1 April 2016 maturities saw its yields dip to lows of 6.65% and 6.95% respectively against its days opening highs of 6.70% and 7.05%. In secondary bill markets, June, July and August 2015 bills were seen changing hands within the range of 6.35% to 6.45% pre-auction and quoted at levels of 6.30% to 6.40% post auction. Meanwhile in money markets, surplus liquidity stood at Rs. 41 b yesterday as no Open Market Operations (OMO) were conducted for a third consecutive day. Overnight call money and Repo rates remained steady to average 6.70% and 6.52%.

Rupee remains stable

The dollar/rupee rate remained mostly unchanged within the range of Rs.130.20-Rs.130.23 yesterday as markets were seen at equilibrium. The total USD/LKR traded volumes for 26 August stood at $ 44.05 million. Given are some forward dollar rates that prevailed in the market: one month – 130.64; three months – 131.32; six months – 132.24.