Positive momentum in primary bond market continues

By Wealth Trust Securities

The weighted average yields at yesterday’s Treasury bond auction were seen decreasing considerably, in comparison to previously recorded average yields of similar maturities. The four-year and 11-month maturity of 15.07.23 recorded the sharpest decrease of 60 basis points to 9.91% (in comparison to the 15.03.23 on 28 May) closely followed by the 9-year and 7-month maturity of 15.03.28 by 52 basis points to 10.20%.

The auction had on offer a total amount of Rs.98 billion, which was successfully subscribed.

Meanwhile, subsequent to the auction, the new maturity of 15.07.23 was seen changing hands within the range of 9.90% to 9.93% while the 15.03.23 and 01.03.21 maturities were traded at levels of 9.85% and 9.50%, respectively. During trading sessions prior to the auction, maturities consisting of the 01.07.19, 01.05.20, 01.05.21 and 01.08.24 were traded at levels of 9.04%, 9.35%, 9.53% and 9.92%, respectively.

The total secondary market Treasury bond/bill transacted volumes for 10 2018 was Rs.5.92 billion.

In money markets, the overnight call money and repo rates decreased further to average 8.12% and 8%, respectively, as the OMO (Open Market Operations) Department of the Central Bank was seen draining an amount of Rs.20billion on an overnight basis by way of a repo auction at a weighted average of 7.62%. The net liquidity in the system increased further to Rs.57.50 billion.

Rupee remains steady   

The USD/LKR rate on spot contracts remained mostly unchanged to close the day at Rs.160/10.

The total USD/LKR traded volume for 10 August was $ 43million.

Some of the forward USD/LKR rates that prevailed in the market were 1 Month - 160.80/00; 3 Months -              162.35/55 and 6 Months - 164.70/00.

The closing, secondary market yields of the most frequently traded T – bills and bonds.