Weekly weighted averages continue to increase

By Wealth Trust Securities

The weekly Treasury bill weighted averages continued to increase at its auction conducted yesterday. 

The market favourite 364 day maturity recorded the sharpest increase of 25 basis points to 10.44% followed by the 91 day bill by 20 basis points to 9.48%. The 182 day bill which was offered after a lapse of three weeks recorded a weighted average rate of 9.75%. 

The total accepted amount was seen dropping short of the total offered amount of Rs.8 billion by Rs.0.10 billion. 

The news and subsequent confirmation that the Government of Sri Lanka has secured a $ 1 billion foreign currency term financing facility propelled the secondary bond market yesterday as yields dipped sharply on the back of considerable buying interest. 

Activity centred on the three 2021s (i.e. 01.03.21, 15.10.21 and 15.12.21) and 15.07.23 maturities as its yields dipped to intraday lows of 10.85%, 10.90%, 11.00% and 11.40% respectively against its days opening highs of 11.20% each and 11.70%. In addition, the 01.08.24 maturity was seen changing hands at 11.40% as well.

The total secondary market Treasury bond/bill transacted volume for 16October was Rs.9.27 billion. 

In the money market, call money and repo averaged 8.44% and 8.37% respectively as the OMO department of Central Bank was seen injecting liquidity by way of an overnight and a six day term repo auction for amounts of Rs.12.26 billion and Rs.20billion respectively at weighted averages of 8.34% and 8.38%.

The net liquidity shortfall increased to Rs.28.28 billion yesterday as the OMO department infused a further amount of Rs.10.6 billion by way of a 14 day term repo auction at a weighted average rate of 8.40%, valued today. 

Rupee loses marginally  

 The rupee on its spot contracts depreciated marginally yesterday to close the day at levels of Rs.171.00/05 against its previous day’s closing levels of Rs.170.90/10 on the back of continued importer dollar demand.

The total USD/LKR traded volume for 16October was $ 74.75 million.

Some forward USD/LKR rates that prevailed in the market were : one month – 172.10/40; three months – 174.25/65; six months – 177.35/75.