Secondary bond market yields remain mostly unchanged

Friday, 1 March 2019 00:00 -     - {{hitsCtrl.values.hits}}



  • Inflation increases further


By Wealth Trust Securities

The secondary bond market yields were seen closing the day mostly unchanged yesterday as the liquid maturities of two 2021s (i.e. 01.08.21 and 15.12.21), two 2023s (i.e. 15.05.23 and 15.07.23) and two 2027s (i.e. 15.01.27 and 15.06.27) were seen changing hands at levels of 10.80% to 10.85%, 11.00% to 11.03% and 11.24% to 11.25% respectively. 

Furthermore, the long end of the curve saw the 01.09.28 and 01.05.29 maturities changing hands at levels of 11.33% and 11.37% respectively while on the very short end of the curve, the two 2019s (01.07.19 and 15.09.19) were exchanged at 9.70% to 9.77% and 10.05% respectively as well.

In the meantime, inflation for the month of February was seen increasing for a second consecutive month to 4.00% on its point to point as against the previous month’s figure of 3.7%. The annual average remained steady at 4.1%.

The total secondary market Treasury bond/bill transacted volumes for 27 February was Rs. 13.20 billion.

In the money market, the overnight call money and repo rates averaged at 8.96% and 8.98% respectively as the net liquidity shortfall stood at Rs.53.13 billion yesterday. 

The OMO Department of the Central Bank conducted two reverse repo auctions for durations of overnight and seven days and injected an amount of Rs.14.5 billion and Rs. 5 billion respectively at weighted average yields of 8.93% and 8.75%. In addition, a further amount of Rs.39.06 billion was injected at the Standing Lending Facility Rate (SLFR) of 9.00%. An amount of Rs.5.43 billion was deposited at the Standing Deposit Facility Rate (SLFR) of 8.00%.


Rupee loses marginally   

 The rupee rate on its spot contract was seen depreciating marginally yesterday to close the day at Rs.180.05/15 against its previous day’s closing level of Rs.179.85/00 on the back of buying interest by banks. 

The total USD/LKR traded volume for the 27th of February 2019 was $ 121.35 million. 

Given are some forward USD/LKR rates that prevailed in the market: one month – 181.00/20; three months – 182.80/10; six months – 185.65/95.