364 day bill weighted average increases for first time in 25 weeks

By Wealth Trust Securities

The 364 day bill weighted average was seen increasing for the first time in 25 weeks at its weekly Treasury bill auction conducted on Monday due to Wednesday been a holiday, recording a 6 basis point increase to 8.17%. This was closely followed by the 91 day bill by 5 basis points to 7.80% while all bids received for the 182 day bill were rejected. The total accepted amount was seen falling short of the total offered amount for the first time in nine weeks as well, with Rs.18.69 billion been accepted against a total offered amount of Rs.22 billion. 

Activity in the secondary bond market picked up marginally subsequent to the auction results as yields were seen increasing marginally on the back of selling interest. The yields of the maturities of 01.05.21, 15.07.23 and 15.06.24 were seen increasing to intraday highs of 8.60%, 9.50% and 9.80% respectively against its previous day’s closing levels of 8.40/50, 9.40/45 and 9.72/75.Furthermore, a limited amount of activity was witnessed on the maturities of 2021’s (i.e. 01.08.21, 15.10.21, and 15.12.21), 01.10.23 and 15.12.23 at highs of 8.65% each, 9.63% and 9.70% respectively.  

The total secondary market Treasury bond/bill transacted volumes for 9 August was Rs.6.94 billion. 

In money markets, Central Banks Open Market Operations (OMO) Department was seen injecting liquidity by way of a term reverse repo auction. The auction injected an amount of Rs.11.70 billion at weighted averages of 7.89% for seven days. Further an amount of Rs.2.35 billion was injected on an overnight basis at a weighted average of 7.77% as the Overnight call money and repo rates averaged 7.77% and 7.89% respectively. The net surplus liquidity increased to Rs.27.49 billion on Monday.

Rupee loses marginally

The USD/LKR rate on spot contracts depreciated marginally yesterday to close the day at Rs.176.90/00 against its previous day’s closing levels of Rs.176.80/85 on the back of buying interest by banks.

The total USD/LKR traded volume for 9 August was $ 125.55 million.

Some of the forward USD/LKR rates that prevailed in the market were one month – 177.30/45; three months – 178.30/50 and six months – 179.90/20.