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Tuesday Apr 23, 2024
Monday, 6 January 2020 00:16 - - {{hitsCtrl.values.hits}}
By Wealth Trust Securities
The secondary bond market was seen ending the year 2019 and commencing the year 2020 on a bullish note as yields were seen decreasing during the week ending 3 January on the back of renewed local buying interest.
The yields on the liquid maturities of 2023’s (i.e. 15.07.23 and 15.12.23), 2024’s (i.e. 15.06.24 and 15.09.24) and 15.10.27 were seen declining to intraweek lows of 9.18%, 9.30%, 9.47% each and 9.75% respectively against its previous weeks closing levels of 9.30/45, 9.45/55, 9.70/75 each and 9.85/95.
Furthermore, maturities of 2021’s (i.e. 01.05.21, 01.08.21 and 15.12.21), two 2025’s (i.e. 15.03.25 and 01.08.25) and 15.09.34 were seen changing hands at lows of 8.55%, 8.60%, 8.70%, 9.60%, 9.65% and 10.16% respectively, reflecting a parallel downward shift of the overall yield curve. 
However, the foreign holding in Rupee bonds was seen decreasing once again, recording an outflow of Rs. 658 million for the week ending 1 January. Furthermore, inflation numbers for the month of December reflected an increase to 4.8% on its point to point and 4.3% on its annual average while weighted average yields on the weekly Treasury bills auction remained steady at 8.02% and 8.45% respectively on the 182-day and 364-day maturities. The daily secondary market Treasury bond/bills transacted volume for the first four days of the week averaged Rs. 8.30 billion. 
In money markets, the Open Market Operations (OMO) Department of the Central Bank resumed injecting liquidity during the latter part of the week by way of overnight and 14 day reverse repo auctions at weighted average yields ranging from 7.49% to 7.52% as the overall liquidity shortfall in the system increased by Rs. 12.4 billion to Rs. 16.7 billion. The call money and repo rates averaged at 7.49% and 7.53%.
Rupee fluctuates
In the Forex market, the USD/LKR rate on spot contracts were seen closing the week at Rs. 181.25/35 against its previous weeks closing level of Rs. 181.45/55 subsequent to trading within a high of Rs. 180.75 and low of Rs. 181.73 during the week.
The daily USD/LKR average traded volume for the first four days of the week stood at $ 74.54 million.
Some of the forward dollar rates that prevailed in the market were 1 month – 181.75/85; 3 months – 182.65/85 and 6 months – 184.25/45.
