Activity continues in secondary bond market

By Wealth Trust Securities

The secondary bond market remained active yesterday with trades witnessed across the yield curve. 

On the short end of the yield curve, buying interest on the 01.08.21, 15.07.23 and 01.08.24 maturities saw its yields decline to daily lows of 11.75%, 11.85% and 12.00% respectively against its highs of 11.85%, 12.00% and 12.10%. The belly end of the curve saw selling interest on the 15.06.27 maturity as its yield increased to a daily high 12.40% against its opening low of 12.30% while the 01.08.26 changed hands at 12.20%.

 In the secondary bill market, October and November 2019 maturities changed hands at 11.00% and 11.15% respectively.

The total secondary market Treasury bond/bill transacted volumes for 14 November 2018 was Rs. 12.88 billion.

Given below are the closing, secondary market yields of the most frequently traded T-bills and bonds.  

 In the money market, overnight call money and repo rates remained mostly unchanged to average 8.97% and 8.98% respectively as the OMO Department of Central Bank was seen infusing liquidity by way of an overnight and four-day term repo auction for successful amounts of Rs. 61.45 billion and Rs. 2.62 billion respectively at weighted averages of 8.69% and 8.68%. The net liquidity shortage in the system increased to Rs. 103.95 billion yesterday. 

Rupee losses further

 In the Forex market, the USD/LKR spot rate was seen depreciating further to close the day at Rs. 176.50/70 against its previous day’s closing levels of Rs. 176.45/55 on the back of moderate buying interest from banks and importer demand. 

The total USD/LKR traded volume for 14 November 2018 was $ 134.50 million. Given below are some of the forward USD/LKR rates that prevailed in the market.