Primary market remains positive

Monday, 26 September 2022 02:36 - - {{hitsCtrl.values.hits}}

Foreign inflow for a third consecutive week
Rupee steady during the week

By Wealth Trust Securities

The week ending 23 September saw the positive momentum in the primary market (Treasury bill auction) continuing as the weekly Treasury bill weighted average rates decreased across the board for a second consecutive week to 31.95%, 30.63% and 29.87% on the 91-day, 182-day and 364-day maturities respectively against its averages of 32.89%, 31.28% and 30.50% recorded on the 7 September.

Yet again, the total offered amount was taken up fully at its first phase of the auction in addition to a further Rs. 16.25 billion being taken up at its second phase.

The secondary bond market activity mainly centred on the liquid 10-year maturity of 01.07.32 as it was seen changing hands from a high of 29.75% to 29.25% prior to the bill auction and between 29.25% to 29.52% following the bill auction.

Nevertheless, the National Consumer Price Index (NCPI; Base 2013=100) for the month of August was seen increasing high of 70.2% on its point to point against its previous month’s figure of 66.7%.

In the meantime, the foreign holding in rupee bonds recorded an inflow for a third consecutive week, to the tune of Rs. 7.85 billion for the week ending 21 September while the daily secondary market Treasury bond/bill transacted volumes for the first four trading days of the week averaged Rs. 15.22 billion. In money markets, the total outstanding liquidity deficit increased to Rs. 569.85 billion by the end of the week against its previous weeks of Rs. 556.58 billion while the CBSL’s holding of Govt. Securities decreased to Rs. 2,321.11 billion against its previous weeks of Rs. 2,361.57 billion. The weighted average rate on repo was at 15.50% for the week.

Forex market

In the Forex market, the middle rate for USD/LKR spot contracts remained steady at 362.90 throughout the week.

The daily USD/LKR average traded volume for the first four trading days of the week stood at $ 42.47 million.

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