Yields edge up marginally ahead of bill auction

Wednesday, 7 January 2015 00:00 -     - {{hitsCtrl.values.hits}}

By Wealth Trust Securities Selling interest mainly on the maturities of 15 May 2017, 15 August 2018, 1 July 2019 and 1 May 2021 saw its yields hit intraday highs of 7.00%, 7.17%, 7.27% and 7.45% respectively against their previous day’s closing levels of 6.80/90, 7.11/14, 7.15/22 and 7.30/40. However, overall activity continued to remain rather dull with the market favourite maturity of 1 July 2022 quoted at levels of 7.76/82. In secondary bill markets, May 2015 bills were quoted at levels of 5.75% to 5.80% while December 2015 was at levels of 5.93% to 5.98%. Today’s auction will have an unchanged amount of Rs. 12 billion on offer which will consist of Rs. 2.0 billion on the 91 day, Rs. 3.0 billion on the 182 day and Rs. 7.0 billion on the 364 day maturities. At last week’s auction, the weighted average on the 364 day bill increased by one basis point to 6.01% while the weighted average on the 91 day remained unchanged at 5.74%. All bids received for the 182 bill was rejected. In money markets, surplus liquidity remained steady at Rs. 35.28 billion yesterday as Central Bank refrained from conducting any auctions under its Open Market Operations (OMO). Overnight call money and repo rates decreased to average 6.15% and 5.71% respectively.   Rupee dips once again The USD/LKR rate on spot next and spot next-next contracts were seen dipping once again yesterday to daily lows of Rs. 132.40 and Rs. 132.42 respectively on the back of importer demand in the absence of spot contracts been traded. The total USD/LKR traded volume for 2 January was $ 74.15 million. Some of the forward dollar rates that prevailed in the market were: one month – 132.85; three months – 133.75; and six months – 134.95.