364 day bill weighted average remains steady; 91 day, 182 day bill weighted averages dip

By Wealth Trust Securities

The 364 day bill weighted average yield at the weekly Treasury bill auction held yesterday remained steady at 8.41% for a second consecutive week, whilst its accepted amount fell short of its offered amount for a second consecutive week as well. However, the total offered amount of Rs. 12 billion was met by accepting more volumes of the 91 day and 182 day bills. The weighted average yields of the 91 day and 182 day maturities decreased to record 7.60% and 7.73% respectively, in comparison to its previous weeks 7.62% and 7.75%. The total bids to offer ratio increased to 3.24:1. 

In the secondary bond market, continued buying interest saw yields on the liquid maturity of 15.09.34 dip to an intraday low of 10.76% against its previous day’s closing level of 10.78/82. In addition, the two 2023 maturities (i.e.15.07.23 & 15.12.23) and 15.06.24 maturity changed hands at levels of 9.875% to 9.90%, 10.05% and 10.25% respectively. In the secondary bill market, the 18 September 2020 bill changed hands at a level of 8.38%, pre-auction. 

The total secondary market Treasury bond/bill transacted volume for 1 October was Rs. 4.15 billion. 

In the money market, the net overnight liquidity surplus stood at Rs. 17.54 billion yesterday with call money and repo averaging at 7.44% and 7.50% respectively. The OMO department of Central Bank was seen infusing liquidity by way of outright purchases of Treasury bonds for successful amounts of Rs. 1.88 billion, Rs. 3.29 billion and Rs. 6.69 billion on the maturities of 01.05.21, 01.08.21 and 15.10.21 respectively at weighted averages of 8.60%, 8.65% and 8.73%, valued today.

Rupee appreciates

In the Forex market, the USD/LKR rate on the spot contract was seen closing the day at Rs. 181.80/95 against its previous day’s closing levels of Rs. 182.30/40, subsequent to trading within the range of Rs. 181.85 to Rs. 182.25.

The total USD/LKR traded volume for 1 October was $ 66.13 million.

Some of the forward USD/LKR rates that prevailed in the market were one month - 182.30/50; three months - 183.40/60 and six months - 185.15/30.