Secondary bond market remains dull ahead of the weekly bill auction

Wednesday, 2 November 2016 00:08 - - {{hitsCtrl.values.hits}}

By Wealth Trust Securities

Activity in secondary bond markets remained dull, ahead of today’s weekly bill auction, with limited trades taking place of the 01.03.21 maturity, within the range of 11.71% to 11.72%.

Today’s auction will have on offer a total amount of Rs. 22.5 billion, consisting of Rs. 5 billion of the 91 day, Rs.7.5 billion of the 182 day and Rs. 10 billion of the 364 day maturities. At last week’s auction, weighted averages continued to increase for a second consecutive week with the 182 day and 364 day maturities reflecting increases of 02 and 05 basis points respectively to 9.48% and 10.24%. All bids received of the 91 day maturity were rejected. In money markets, the overnight repo rate increased marginally to average 8.69% as net deficit in the system increased to Rs. 34.36 billion. The Open Market Operations (OMO) Department of the Central Bank of Sri Lanka continued to inject an amount of Rs. 35.00 billion on an overnight basis by way of a Reverse Repo auction at a W. Avg of 8.50%. The overnight call money rate remained steady at 8.42%.

Rupee losses

The USD/LKR rate on one week forward contracts depreciated once again to close the day at Rs. 148.55/65 against its previous day’s closing levels of Rs. 148.30/50. The total USD/LKR traded volume for 31 October 2016 was $ 10.21 million.

Some of the forward USD/LKR rates that prevailed in the market were 1 Month - 149.40/65; 3 Months - 150.95/05 and 6 Months - 153.35/45.