Bond yields remain mostly unchanged ahead of weekly bill auctions

• Weekly auction offered amount at a 23-week low

By Wealth Trust Securities

The secondary bond market yields remained broadly steady at the start of a shortened trading week yesterday with activity moderating.

Limited trades were seen on the maturities of 2021s (i.e. 15.10.21 and 15.10.21), 15.01.23, 2024s (i.e.15.03.24 and 15.09.24), 2025s (i.e. 15.03.25 and 01.05.25) and 15.10.27 at levels of 7.10% to 7.15%, 7.10% to 7.20%, 7.78%, 8.38% to 8.40%, 8.39% to 8.42%, 8.52%, 8.59% to 8.60% and 8.90% to 8.91% respectively.

In the secondary bill market, July 2020, October 2020 and May 2021 maturities changed hands at levels 6.40% to 6.53%, 6.75% and 6.90% respectively. Today’s bill auction will have on offer a 23-week low total volume of 21.5 billion, consisting of Rs. 5 billion on the 91-day, Rs. 2.5 billion on the 182-day and a further Rs. 14 billion of the 364-day maturities. At last week’s auction, the weighted averages on the 91-day and 182-day maturities decreased to 6.69% and 6.82% respectively while the weighted average on the 364-day bill remained steady at 6.93%.

The total secondary market Treasury bond/bill transacted volume for 29 May was Rs. 6.2 billion. 

In money markets, the weighted average rates on overnight call money and repo was recorded at 5.86% and 5.91% respectively the overnight net liquidity surplus in the system stood at Rs.73.79 billion. The Domestic Operations Department (DOD) of the Central Bank of Sri Lanka refrained from conducting any auctions yesterday.

Rupee appreciates marginally  

In the Forex market, the USD/LKR rate on the spot rate appreciated marginally yesterday to close the day at Rs. 186.00/10 against its previous day’s closing levels of Rs. 186.20/35 on the back selling interest from banks.

The total USD/LKR traded volume for 29 May was $ 62.85 million.  

 (References: Central Bank of Sri Lanka, Bloomberg E-Bond trading platform, money broking companies.)