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Downward spiral of 364-day bill continues

Comments / {{hitsCtrl.values.hits}} Views / Thursday, 21 March 2019 00:05



  • Benchmark bill decreases to 19-week low
  • Short-dated bond yields dip marginally   

By Wealth Trust Securities

The decreasing trend in the weekly weighted averages continued at Tuesday’s Treasury bill auction, led by the benchmark 364-day bill with its weighted average dipping by six basis points to a 19-week low of 10.52%.

This was closely followed by the 91-day and a 182-day bill, as it was seen decreasing by six and eight basis points respectively to 9.49% and 9.79%. 

The exact total offered amount of Rs. 24 billion was met at the auction as the total bids to total offer ratio increased to 2.78:1.

The secondary market bond yields were seen decreasing marginally, mainly on the short end of the yield curve with the 01.08.21 and 15.12.21 maturities dipping to intraday lows of 10.73% and 10.80% respectively followed by the 15.03.24 to 11.05%. 

In addition, the 01.05.29 maturity was seen changing hands at 11.47%.  

In the secondary bill market, January to February 2019 bills were seen changing hands within the range of 10.35% to 10.51%.  

The total secondary market Treasury bond/bill transacted volumes for 18 March was Rs.4.06 billion.

In money markets, the Open Market Operations (OMO) department of the Central Bank of Sri Lanka was seen infusing amounts of Rs. 17.70 billion and Rs. 10 billion each on an overnight, seven days and 14 days basis at weighted averages of 8.78%, 8.84% and 8.86% respectively yesterday.

The overnight call money and repo rates averaged 8.85% and 8.86% respectively as the net liquidity shortfall in the system increased to Rs.36.18 billion Tuesday. 

Rupee dips marginally

In the Forex market, the USD/LKR rates on spot contracts were seen depreciating marginally Tuesday to close the day at Rs. 178.40/45 against its previous day’s closing levels of Rs. 178.25/35 on the back of buying interest by banks.  The total USD/LKR traded volume for 18 March was $ 55.75 million.  Some of the forward USD/LKR rates that prevailed in the market were one month – 179.30/50; three months – 181.20/40; and six months – 184.15/35.

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