Bond yields steady ahead of weekly bills auction

Wednesday, 31 July 2019 00:00 - - {{hitsCtrl.values.hits}}

By Wealth Trust Securities

The secondary bond market yields remained mostly unchanged yesterday ahead of the weekly Treasury bill auction due today. In total an amount of Rs. 22 billion will be on offer, consisting Rs. 6.5 billion on the 91-day maturity, Rs. 2.5 billion on the 182-day maturity and further Rs. 13 billion on the 364-day maturity. At last week’s auction, the weighted averages decreased across the board to 7.89%, 7.86% and 8.38% respectively on the 91-day, 182-day and 364-day maturities.

In secondary bond markets, yields on the 2021 maturities (i.e. 01.03.21, 01.08.21 and 15.10.21) decreased marginally yesterday to trade within the range of 8.62% to 8.82% while the maturities of 01.10.22, two 2023’s (i.e. 15.03.23 and 15.07.23), 15.06.24, 15.01.27 and 01.05.29 were seen changing hands at levels of 9.10%, 9.46% to 9.50%, 9.80%, 9.95% to 9.97% and 10.04% respectively.

The total secondary market Treasury bond/bill transacted volumes for 29 July was Rs. 8.08 billion.

In the money market, the overnight call money and repo rates averaged at 7.70% and 7.76% respectively as the OMO Department of the Central Bank was seen draining out an amount of Rs. 26.91 billion on an overnight basis by way of a repo auction at a weighted average of 7.67%. The overnight net liquidity surplus increased to Rs. 50.60 billion yesterday.

Rupee loses marginally

In the Forex market, the USD/LKR rate on spot contracts depreciated marginally to close the day at a level of Rs. 176.28/32 against its previous day’s closing level of Rs. 176.15/25 on the back of buying interest by banks.

The total USD/LKR traded volume for 29 July was $ 67.47 million.

Some forward USD/LKR rates that prevailed in the market are 1 month – 176.85/90, 3 months – 178.00/15, 6 months – 179.95/15.