Money market liquidity up to 13-day high

Thursday, 30 August 2012 02:13 - - {{hitsCtrl.values.hits}}

Overnight surplus liquidity yesterday increased for a second consecutive day by Rs 2.7 billion to a 13 day high of Rs. 8.billion, according to Wealth Trust Securities.

Un-sterilised dollar purchases by the Central Bank were seen as the reason behind the increase, according to market sources.

Wealth Trust said overnight call money and repo rates remained steady at weighted averages of 10.55% and 9.55% respectively.

This was as the Central Bank drained an amount of Rs. 6.3 b from the system on an overnight basis at a weighted average of 9.43% through its Open Market Operations (OMO).

In bond markets, Wealth Trust said a limited amount of buying saw secondary market Treasury yields remain rather flat yesterday. Small volumes were seen changing hands on the 18 ½ month bond at levels of 13.74% and 13.75% while on the five-year maturity it was at 14.36%. Furthermore, selling pressure on secondary market Treasury bills remained throughout the day as market eagerly awaited Inflation figures due to be announced today.

Meanwhile, the USD/LKR rate remained steady yesterday, to close the day at Rs. 132.36/132.40 amidst heavy demand for contracts value cash for 29 August 2012 and 30 August 12 as contracts value spot fell for 4 September 2012 due to 3 September 2012 being a New York holiday.

The total dollar/rupee traded volume for 28 August 2012) stood at US$ 24.07 million, Wealth Trust said.

Some forward dollar rates that prevailed in the market were one month – 133.68; three months – 136.18 and six months – 139.63.