Activity in secondary bond markets remains high

Friday, 6 December 2013 00:00 - - {{hitsCtrl.values.hits}}

A continued sellers’ market saw yields decreasing for a seventh consecutive day during morning hours of trading yesterday as the overall yield curve sustained its downward trend.

Activity continued to remain high on the more liquid 2018 maturities (i.e. 1 April 2018 and 15 August 2018) as its yields were seen hitting intraday low of 10.25% and 10.28% respectively, reflecting a decrease of 16 basis points and 19 basis points in comparison to its previous day’s closing levels, Wealth Trust Securities said in a statement. However, selling interest coupled with profit taking towards the latter part of the day saw its yields increase once again in hitting daily highs of 10.43% and 10.50% and closed the day mostly unchanged at levels of 10.38/42 and 10.44/48 once again. Furthermore, buying pressure on secondary market Treasury bills continued as well with the 364-day bill being quoted at levels of 9.00/20 while the 182-day bill was at 8.30/50. Meanwhile, surplus liquidity in money market stood at Rs. 21.54 billion yesterday as the Open Market Operations (OMO) department of Central Bank was seen mopping up Rs. 5.65 billion on a seven-day basis at a weighted average of 7.43% and a further Rs. 15.89 b being deposited at its window rate of 6.50%. The overnight call money and repo rates held steady to average 7.76% and 7.04% respectively. The rupee was seen trading at levels of Rs. 130.85 and closed the day at Rs. 130.85/87 as demand/supply was seen at equilibrium. The total USD/LKR traded volume for the previous day (4 December 2013) stood at US$ 96.12 million.