Upward trend in bond yields continue ahead of monetary policy announcement
Friday, 17 October 2014 00:42
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By Wealth Trust Securities
Activity in secondary bond markets remained high yesterday ahead of today’s monetary policy announcement for the month of October as continued selling interest saw yields increase for a third consecutive day.
Yields were seen decreasing marginally on fresh buying interest during morning hours of trade to intraday lows of 7.00%, 7.10%, 7.85%, 8.00% and 8.20% respectively on the more liquid maturities of 15 May 2017, 1 April 2018, 1 May 2021, 1 July 2022 and 1 January 2024.
However, selling interest towards the latter part of the day saw yields edge up once again to intraday highs of 7.15%, 7.40%, 8.10%, 8.30% and 8.50%. Meanwhile in Treasury bill markets, the 364 day maturity continued to change hands within the range of 6.00% to 6.10%.
Meanwhile in money markets, the OMO (Open Market Operations) department of Central Bank was seen mopping up an amount of Rs. 58.41 billion via three term repo auctions at yields of 6.01% for 35 days, 5.96% for 56 days and 5.99% for 77 days yesterday. The overnight call money and repo rates averaged at 5.98% and 5.56% respectively as overall surplus liquidity dipped to Rs. 14.24 billion..
Rupee gains marginally
The dollar/rupee on spot next contracts was seen appreciating marginally to close the day at levels of Rs. 130.70/75 yesterday. The total USD/LKR traded volume for 15 October was at $ 98.20 million.
Some of the forward dollar rates that prevailed in the market were: one month – 131.20; three months – 131.98; and six months – 133.08.
