Thursday Jun 04, 2026
Thursday Jun 04, 2026
Wednesday, 3 June 2026 00:06 - - {{hitsCtrl.values.hits}}
By Wealth Trust Securities
The secondary Bond market remained under pressure today, extending the bearish sentiment observed at the start of the week. Yields continued to edge higher across the curve amid persistent selling interest and cautious investor participation. Trading activity remained subdued, although transaction volumes were supported by selective block trades.
Market sentiment continued to be weighed down by a combination of external and domestic developments. Crude oil prices picked up on the news that Iranian negotiators will stop exchanging messages with the US through intermediaries in retaliation for ongoing ceasefire violations. Investors largely adopted a wait-and-see approach, resulting in limited risk appetite and continued upward pressure on yields.
The 01.07.28 maturity traded at the rate of 11.50%. The 15.12.29 maturity traded at the rate of 12%. The 01.03.30 maturity traded at the rate of 12.10% and the 01.08.30 maturity traded at the rate of 12.15%. The 15.06.34 maturity traded up the range of 13.12% to 13.13%.
The Treasury Bill auction scheduled for today, will have a total amount of Rs. 140 billion on offer. This will comprise of Rs. 65 billion offered on the 91-day maturity, Rs 55 billion on the 182-day maturity and Rs. 20 billion on the 364-day maturity. This is below the maturity in line with the scheduled auction, which is estimated to be around Rs. 168.80 billion.
To recap at the weekly Treasury Bill auction conducted last Tuesday, rates were seen increasing for the second consecutive week. This reflected the bearish bias as well as the 100-basis point Monetary Policy rate hike. Accordingly, the weighted average yield rates on the 91-day tenor increased by 118 basis points to 9.36% and the 182-day tenor increased by 143 basis points to 9.68% and the 364-day tenor increased by 134 basis points to 9.83%. Rates were seen rising to the highest level in around 79 weeks since late November 2024.
The Auction was undersubscribed, raising only 68.26% or Rs. 95.56 billion out of the Rs. 140 billion on offer at the first phase in competitive bidding. The bid to offer ratio stood at 1.23 times.
In the money market, the weighted average call money rate remained above 9% for a fourth consecutive day, recording at 9.14% yesterday while weighted average REPO rate stood at 9.19%.
The net liquidity surplus was recorded at Rs. 93.56 billion. An amount of Rs 115.13 billion was deposited at Central Bank’s SDFR (Standing Deposit Facility Rate) of 8.25% as against an amount of Rs. 61.57 billion withdrawn from the Central Bank’s SLFR (Standing Lending Facility Rate) of 9.25%. In addition, the Domestic Operations Department (DOD) of the Central Bank of Sri Lanka drained out an amount of Rs. 40 billion by way of overnight repo auction at a weighted average rate of 8.75%.
Forex market
In the Forex market, the USD/LKR rate on spot contracts closed at the rate of Rs. 332.50/333.50 as against the previous day’s closing of Rs. 331.50/332.50.
The total USD/LKR traded volume for 1 June 2026 was $ 70.93 million.
(References: Public Debt Management Office – Finance Ministry, Central Bank of Sri Lanka, Bloomberg E-Bond trading platform, Money broking companies)
