Positive momentum in primary auctions continue

Thursday, 21 January 2021 00:00 -     - {{hitsCtrl.values.hits}}


  • Bond yields decrease once again
  • Money market liquidity decreases to a two-month low

By Wealth Trust Securities

The weekly Treasury bill auctions conducted yesterday continued its positive outcomes as the total offered amount of Rs. 40 billion was successfully subscribed for a third consecutive week. 

The weighted average yield on the market favourite 364-day bill decreased by 03 basis points to 4.99%, breaching the psychological 5.00% level for the first time in 09 weeks. This was closely followed by the 182-day bill by 01 basis point to 4.77%. The weighted average yield on the 91-day bill remained steady at 4.70%. This was in comparison to the published stipulated cut off rates of 4.71%, 4.80% and 5.02% respectively on the 91-day, 182-day and 364-day bill maturities. The bids to offer ratio stood at 2.18:1. 

In the secondary bond market, yields decreased once again yesterday due to renewed buying interest on the maturities of 2022’s (i.e. 15.11.22 and 15.12.22) and 2024’s (i.e. 15.09.24 and 01.12.24) to hit intraday lows of 5.35%, 5.36%, 6.22% and 6.25% respectively against its previous day’s closing level of 5.40/43, 5.40/48, 6.27/32 and 6.32/37. 

Furthermore, maturities consisting of the 01.10.22, 2023’s (i.e. 15.01.23, 15.07.23, 01.10.23 and 15.12.23), 15.06.24 and 15.01.26 traded at levels of 5.35% to 5.45%, 5.40%, 5.67%, 5.70% to 5.74%, 5.60% to 5.78%, 6.20% and 6.60% respectively as well. In secondary bills, 23rd April maturity changed hands at 4.71%.

The total secondary market Treasury bond/bill transacted volumes for 19 January was Rs. 1.46 billion.            

In the money market, overnight surplus liquidity was seen decreasing to a two-month low of Rs.166.79 billion yesterday in comparison to its previous days figure of Rs. 208.85 billion. Weighted average rates on the overnight call money and repo remained mostly unchanged at 4.53% and 4.55% respectively.

Rupee remains mostly unchanged  

The Interbank USD/LKR rate on spot next contracts remained mostly unchanged to close the day at Rs. 196.00/198.00.

The total USD/LKR traded volume for 19 January was $ 51.75 million.   

(References: Central Bank of Sri Lanka, Bloomberg E-Bond trading platform, Money broking companies)