Secondary bill market yields dip subsequent to auction results

Thursday, 5 September 2013 00:52 - - {{hitsCtrl.values.hits}}

By Wealth Trust Securities Secondary bill market yields dipped across all maturities subsequent to the release of the weekly Treasury bill auction results yesterday, as weighted averages remained unchanged against its previous week’s levels for the first time in 28 weeks.

The total accepted amount of Rs. 2.7 billion was the lowest since 29 February 2012 and it was Rs.6.3 billion lesser than its initial offered amount of Rs. 9 billion. Furthermore the total bids received dropped to an 88-week low of Rs. 14.4 billion as well. The 91-day, 182-day and 364-day maturities recorded weighted averages of 8.61%, 9.64% and 10.56% respectively while in secondary markets; March 2014 bills were seen changing hands within the range of 9.95% to 10.05% while maturities nearing the 364-day bill were traded within the range of 10.45% to 10.55%.

Meanwhile, in secondary bond markets, activity continued to remain rather dull yesterday with the liquid two five-year maturities (i.e. 1 April 2018 and 15 August 2018) closing the day marginally higher at levels of 11.80/82 and 11.83/87 respectively while yields on two-year maturities were seen dipping to an intraday low of 11.15% to close the day at levels of 11.10/20. The weighted average on the overnight repo auction conducted by the Open Market Operations (OMO) department of Central Bank continued to decrease to record 7.20% yesterday as Rs. 8 b was mopped up while a further amount of Rs. 4.25 b was mopped up for a period of seven days at a weighted average of 7.95% as surplus liquidity in money markets remained high at Rs. 21.11 b. A further amount of Rs. 8.86 b was seen been deposited at CBSL’s Repo window of 7.00%. This intern helped overnight call money and repo rates to average 8.69% and 8.12% respectively. Spot next contracts remain steady The rupee on spot next contracts remained stable for a third consecutive day at levels of Rs. 133.05-Rs.130.10 as volumes traded continued to be moderate. The total USD/LKR traded volume for the previous day (3 September 2013) stood at US$ 19.95 million. Some of the forward dollar rates that prevailed in the market were one month – 133.87; three months – 135.70; and six months – 138.30.