Secondary bond market activity dries up

Tuesday, 27 November 2018 01:03 - - {{hitsCtrl.values.hits}}

By Wealth Trust Securities

The dull sentiment in the secondary bond market continued yesterday on the back of moderate trades, mainly on the short end of the yield curve. The 2021 maturities (i.e. 01.03.21, 01.08.21 and 15.10.21) were the most traded duration as it was seen changing hands within the range of 11.87% to 11.95%. In addition, the 15.06.27 maturity was traded at levels of 12.46%. In the secondary bill market, August and November 2019 maturities changed hands at levels of 10.7% and 11.20%, respectively.

The total secondary market Treasury bond/bill transacted volumes for 23 November 2018 was Rs. 9.89 billion.

In the money market, the OMO Department of the Central Bank infused liquidity for durations of overnight, seven days and 14 days for a successful amount of Rs. 24.5 billion, Rs. 6 billion and Rs. 3.5 billion at weighted averages of 8.5%, 8.66% and 8.69%, respectively, as the net liquidity shortfall stood at Rs. 51.42 billion. The overnight call money averaged 8.96%.

Rupee dips below Rs. 180

The prevailing political uncertainties coupled with continued demand by banks and importers saw the USD/LKR rate on spot contracts dip below the Rs. 180 psychological level for the first time to close the day at Rs. 180.10/30 against its previous day’s closing of Rs. 179.50/00.

The total USD/LKR traded volume for 23 November was $ 26.92 million.

Some of the forward USD/LKR rates that prevailed in the market were 1 month – 181.00/40, 3 months – 182.90/40, and 6 months – 185.90/40.