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Sunday Dec 15, 2024
Monday, 28 February 2022 00:00 - - {{hitsCtrl.values.hits}}
By Wealth Trust Securities
The yield on a three-year bond maturity or in this instance 01.08.2025 was seen hitting 13.00% for the first time since March 2017 at its secondary market trading on Friday following its auction outcome.
At the auction, the three-year maturity of 01.08.2025 recorded a weighted average of 12.25% against its pre-auction yield of 11.15/25 while the 11-year maturity of 15.01.2033 recorded a weighted average of 13.14% against its pre-auction yield of 12.90/05. A total of Rs. 32.4 billion was taken up on the two maturities against a total offered amount of Rs. 45 billion. The second phase of the auction was opened on the 15.01.2033 maturity while a direct issuance window of 20% of the offered amount on the 01.08.2025 maturity was opened until close of business of the day prior to settlement (i.e. 4 p.m. on 28.02.2022).
Furthermore, the total accepted amount at the weekly Treasury bill auction was seen falling short of the total offered amount for the first time in eight weeks during the week ending 25 February, as only a total of Rs. 64.56 billion was accepted against a total offered amount of Rs. 80 billion.
Separately the National Consumer Price Index (NCPI; Base 2013=100) for the month of January increased sharply to a high of 16.8% on its point to point against its previous month’s figure of 14.0% along with the annual average increasing as well to 8.1% from 7.0%. Further trades in the secondary bond market were seen on the maturities of 15.05.23, 15.03.24, 15.03.25, 01.08.25, 01.02.26 and 15.06.27 at levels of 9.20%, 10.40%, 11.00% to 11.01%, 11.15% to 11.20%, 11.65% and 12.02% to 12.04% respectively prior to the bond auctions on Friday while in secondary bills, March, May and June 2022 maturities traded at levels of 7.25% to 7.26%, 8.00% to 8.65% and 8.65% to 8.70% respectively.
The foreign holding in rupee bonds remained mostly unchanged at Rs. 2.65 billion for the week ending 23 February while the daily secondary market Treasury bond/bill transacted volumes for the first four trading days of the week averaged Rs. 18 billion.
In money markets, the total outstanding liquidity deficit decreased to Rs. 673.90 billion by the end of the week against its previous weeks of Rs. 693.54 billion while CBSL’s holding of Govt. Security’s stood at Rs. 1,511.37 billion against its previous weeks of Rs. 1,511.20 billion.
The weighted average rates on call money and repo remained mostly unchanged at 6.48% and 6.50% respectively as a staggering volume exceeding Rs. 645 billion was withdrawn on a daily basis from Central Banks SLFR (Standard Lending Facility Rate) of 6.50%.
Forex market
In Forex markets, overall activity continued to remain moderate during the week while limited trades were witnessed on the USD/LKR spot contracts at a level of Rs. 202.97 to Rs. 203.00.
The daily USD/LKR average traded volume for the first four trading days of the week stood at $ 31.27 million.
(References: Central Bank of Sri Lanka, Bloomberg E-Bond trading platform, Money broking companies)
