Bond market remains active as yields fluctuates

Thursday, 27 December 2018 00:04 - - {{hitsCtrl.values.hits}}

By Wealth Trust Securities

The secondary bond markets remained active yesterday as yields were seen fluctuating. The liquid maturities of 15.12.21 and 01.08.26 were seen hitting intraday lows of 11.47% and 11.68% respectively in morning hours of trading against its previous day’s closing levels of 11.45/50 and 11.65/70. Nevertheless, yields were seen bouncing back towards the later part of the day to hit highs of 11.60% and 11.78% respectively on the back of selling interest. Furthermore, activity was also witnessed of the 01.05.20, 2021’s (i.e. 01.03.21, 01.08.21 and 15.10.21), three 2023’s (i.e. 15.03.23, 15.05.23 and 15.07.23), 01.08.24 and 15.06.27 maturities at levels of 11.15% to 11.20%, 11.40% to 11.44%, 11.53% to 11.70%, 11.76% and 11.68% to 11.73% respectively. In the secondary bill market, the 13th December 2019 maturity was traded at 10.90%.

The total secondary market Treasury bond Transacted volume for 24 December was Rs. 11.00 billion.

In the money market, the net liquidity shortfall stood at Rs.101.30 billion yesterday with call money and repo averaging at 8.99%. The OMO department of Central Bank was seen infusing liquidity by way of an overnight and a seven day term repo auction for successful amounts of Rs. 25.00 billion and Rs. 27.4 billion respectively at weighted averages of 8.96% and 8.99%. A further total amount of Rs. 1.00 billion was injected by way of outright purchases of Treasury bills at weighted averages ranging from 9.60% to 9.67% for duration of 78 days to 85 days, valued today.

Rupee loses marginally

In the Forex market, the USD/LKR rate on spot contracts depreciated marginally yesterday to close the day at Rs. 181.80/00 against its previous day’s closing levels of Rs. 181.50/65 on the back of continued buying interest from banks.

The total USD/LKR traded volume for 24 December was $ 77.90 million.

Some of the forward USD/LKR rates that prevailed in the market were 1 month - 182.75/15; 3 months - 184.70/20 and 6 months - 187.75/25.