Money market liquidity turns red for the first time in four weeks

Friday, 26 July 2013 00:00 - - {{hitsCtrl.values.hits}}

By Wealth Trust Securities Liquidity in money markets turned negative for the first time in four weeks yesterday to a net deficit of Rs. 4.91 billion. An amount of Rs. 6.29 billion was accessed from Central Bank’s discount window of 9.00% while an amount of Rs. 1.38 billion was seen been deposited at its Repo window of 7.00%.

All efforts by the Open Market Operations department (OMO) to infuse an amount of Rs. 3.5 billion on an overnight basis by way of a reverse repo auction was unsuccessful due to bids received been too high according to market sources. The overnight call money weighted average increased marginally to 8.79% while the repo weighted average remained steady at 8.23%. Meanwhile, in secondary bond markets, yields remained steady yesterday with a very limited amount on the liquid two five year maturities (i.e. 1.4.2018 and 15.8.2018), changing hands at levels of 11.26% and 11.33% respectively. Furthermore, the eight year maturity was seen been quoted at levels of 11.50/53 while the three year was quoted at 10.93/98. In secondary market bills, the 364-day bill was seen changing hands at levels of 10.50% to 10.52% once again. In Forex markets, despite the USD/LKR spot rate remaining steady at Rs. 131.50/60, spot next contracts were seen changing hands within the range of Rs. 131.62 to 131.73 and tom contracts within the range of Rs. 131.48 to 131.60. The total USD/LKR traded volume for the previous day (24.7.13) stood at US$ 73.24 million.

Some of the forward dollar rates that prevailed in the market were one month – 132.47, three months – 133.93 and six months – 136.10.