Weekly averages decline for first time in four weeks

Thursday, 1 December 2016 00:00 - - {{hitsCtrl.values.hits}}

By Wealth Trust Securities

The weighted averages at yesterday’s weekly Treasury bill auction were seen decreasing for the first time in four weeks, reversing an upward trend driven by the surplus liquidity increase in the system.

The 182 day bill reflected the sharpest decline of 16 basis points to 9.55% followed by the 364 day bill by 15 basis points to 10.10%. The 91 day bill remained steady for a sixth consecutive week at 8.60%.

The total accepted amount too increased to a four-week high of Rs. 15.73 billion against its total offered amount of Rs. 25 billion. The total bids to offer ratio increased to a nine-week high of 282% as well.

In secondary bond markets, the yields on the liquid maturities were seen closing the day broadly steady yesterday as activity moderated. Activity was witnessed on the maturities of 01.03.21, 01.09.23 and 01.08.24 at levels of 12.00%, 12.45% and 12.50% to 12.53% respectively against its previous day’s closing levels of 11.90/05, 12.35/45 and 12.45/52.

Nevertheless, foreign selling interest on the 15.08.18 and 15.09.19 maturities saw its yields increasing to intraday highs of 11.50% and 11.75% respectively against its previous day’s closing levels of 11.20/40 and 11.60/70 with volume being traded.

Meanwhile, inflation for the month of November saw its point to point decrease to a seven-month low of 3.4% against its previous month of 4.2% while its annualised average remained unchanged at 3.6%.

Meanwhile, in money markets, overnight call money and repo rates increased marginally to average 8.43% and 8.64% respectively as net surplus liquidity dipped to Rs. 10.83 billion yesterday. The OMO (Open Market Operations) department of the Central Bank was seen mopping up an amount of Rs. 12.00 billion on an overnight basis by way of a Repo auction at a WAvg of 7.47%.

Rupee appreciates marginally

The USD/LKR rate on the active spot next contract was seen appreciating marginally yesterday to close the day at Rs. 148.95/00 against its previous day’s closing levels of Rs. 149.20/30. The total USD/LKR traded volume for 29 November 2016 was $ 37.40 million.

Some of the forward USD/LKR rates that prevailed in the market were one month - 149.75/90; three months - 151.45/55 and six months - 153.90/00.