Secondary bond markets lacklustre ahead of weekly auction

Wednesday, 24 July 2013 00:00 - - {{hitsCtrl.values.hits}}

By Wealth Trust Securities Activity in secondary bond markets dried up yesterday ahead of today’s weekly Treasury bill auction. At today’s auction, a total amount of Rs. 10 billion will be on offer for a second consecutive week with Rs. 1 billion each on the 91-day and 182-day maturities and Rs. 8 billion on the 364-day maturity. At last week’s auction, weighted averages (WAvg) dipped on the 182-day and 364-day maturities by two basis points (bp) and five bp respectively to 9.66% and 10.59% while the 91-day WAvg remained unchanged at 8.63%. A very moderate volume on the liquid two five-year maturities (i.e. 1 April 2018 and 15 August 2018) were seen changing hands yesterday at levels of 11.27% to 11.28% and 11.35% respectively, while the three-year maturity was seen been quoted at 10.98/02. In addition, the 364-day bill was quoted at a level of 10.52/56 as well in secondary markets.

Given below are the closing, secondary market yields for the most frequently traded maturities. The weighted averages on overnight call money and repo rates remained steady to average 8.73% and 8.20% respectively as surplus liquidity stood at Rs. 6.0 billion yesterday. The Open Market Operations (OMO) department of Central Bank was seen mopping up an amount of Rs. 4 billion on an overnight basis at a weighted average of 7.70% by way of a repo auction while a further amount of Rs. 2.0 billion was seen been deposited at CBSL’s repo window of 7.00%. Rupee appreciates marginally Selling interest on contracts value cash saw the USD/LKR rate appreciate marginally yesterday by five cents to close the day at levels of Rs. 131.50/55 with spot next contracts changing hands within the range of Rs. 131.53 to Rs. 131.60 as well. The total USD/LKR traded volume for the previous day (19 July 2013) stood at $ 38.74 million. Some of the forward dollar rates that prevailed in the market were; 1-Month: 132.40, 3-Months: 133.90 and 6-Months: 136.20.