Bond market yields hold steady; rupee continues to advance

By Wealth Trust Securities

The secondary bond market commenced the week on a subdued note, with a complete standstill for much of the day, apart from a few transactions earlier on. The market overall saw two-way quotes move sideways, with yields holding broadly steady. However, some focused buying interest observed on 15.12.2028 maturity, where it yields dip down to intraday low of 12.08% against highs of 12.10%. Additionally, limited trades were observed on the maturities of 01.02.26 and 15.03.31 within the ranges of 10.95% and 12.20% to 12.13% respectively, on relatively slim volumes overall.

In secondary market bill transactions, March 2024 maturities were seen changing hands at 9.60% on the back of thin volumes.  The total secondary market Treasury bond/bill transacted volume for 15 March was Rs. 72.19 billion.

In money markets, the weighted average rates on overnight call money and Repo stood at 9.17% and 9.44% respectively. The DOD (Domestic Operations Department) of Central Bank injected liquidity by way of an overnight and 7-day reverse repo auction for Rs. 56.30 billion and Rs. 50.00 billion at the weighted average rates of 9.12% and 9.24% respectively.

The net liquidity deficit stood at Rs. 77.07 billion yesterday as an amount of Rs. 15.72 billion was withdrawn from Central Banks SLFR (Standard Lending Facility Rate) of 10.00% against an amount of Rs. 44.95 billion deposited at Central Banks SDFR (Standard Deposit Facility Rate) of 9.00%. 

Forex Market 

In the Forex market, the USD/LKR rate on spot contracts closed the day up at Rs. 304.35/304.50 against its previous day’s closing level of Rs. 305.20/305.25.

The total USD/LKR traded volume for 15 March was $ 120.06 million. 

(References: Central Bank of Sri Lanka, Bloomberg E-Bond trading platform, Money broking companies)