Bond yields dip marginally ahead of weekly bill auction

By WealthTrust Securities

Secondary market bond yields dipped marginally yesterday on the back of moderate volumes ahead of today’s weekly Treasury bill auction. 

Yields on the liquid maturities of 15.09.19, 01.03.21, 01.08.25 and the two 2026s (i.e. 01.06.26 and 01.08.260) were seen hitting intraday lows of 11.45%, 11.855%, 12.44% and 12.55% each respectively against their previous day’s closing levels of 11.45/55, 11.89/91, 12.27/29, 12.50/60, 12.53/60 and 12.57/60.

This was ahead of today’s weekly Treasury bill auction where a total of Rs. 27 billion is on offer consisting of Rs. 12 billion each on the 182 day and 364 day maturities and a further Rs. 3 billion on the 91 day maturity. At last week’s auction, the weighted averages on the 182 day and 364 day bills increased by 02 basis points each to 9.94% and 10.74% respectively while weighted average on the 91 day bill remained steady at 9.01%.

Given below are the closing secondary market yields of the most frequently traded maturities.

Meanwhile, in money markets yesterday the overnight call money and repo rates averaged 8.40% and 8.48% respectively as the Open Market Operations (OMO) Department of Central Bank injected an amount for Rs.15 billion at a weighted average rate of 8.40%. The net liquidity shortfall in the system reduced to Rs. 9.87 billion.

 Rupee remains steady  

 In Forex markets, the USD/LKR rate on all three contracts (spot, spot next and one week forward) remained steady for a seventh consecutive day at Rs. 145.50/55, Rs.145.55/60 and Rs. 145.74/78 respectively. The total USD/LKR traded volume for 22 August 2016 was $ 46.25 million.

 Given below are some forward USD/LKR rates that prevailed in the market, 

One Month    -    146.40/45    

Three Months    -     148.05/15

Six Months    -     150.60/70