Friday Feb 27, 2026
Friday Feb 27, 2026
Wednesday, 25 February 2026 00:08 - - {{hitsCtrl.values.hits}}
By Wealth Trust Securities
The secondary Bond market yesterday saw rates edge up further, extending the upward momentum from earlier this week. Trading activity remained at subdued levels, with the market at a virtual standstill for much of the day.
Despite this, transaction volumes remained healthy, supported by several block trades as renewed buying interest emerged at the recently elevated yield levels, curtailing further upwards movement. However, overall market participants continued to adopt a cautious, wait-and-see approach ahead of the back-to-back Treasury Bill and Bond auctions, as well as the release of the February 2026 CCPI inflation data later this week.
Accordingly, limited trades were seen on selected tenors. The 15.10.28 and 15.12.28 maturities were seen trading at levels of 9.15% and 9.19% respectively while the 15.06.29, 15.10.29 and 15.12.29 maturities were seen changing hands at the rates of 9.39%-9.40%, 9.54%-9.49% and 9.50%-9.49% respectively. The 01.03.30 maturity traded at the rate of 9.55%. The 15.06.34 and 15.06.35 maturities traded within the ranges of 10.80%-10.75% and 10.85%-10.84%.
In secondary market Bills, June 2026 maturities were seen trading at the rates of 7.82%-7.75% and July 2026 maturities at the rate of 7.96%.
Meanwhile, the weekly Treasury Bill auction scheduled for today will have on offer a total amount of Rs. 90 billion. The auction will comprise of Rs. 10 billion in 91-day Bills, Rs. 45 billion in 182-day Bills, and Rs. 35 billion in 364-day Bills. The offered amount is below the maturing volume, which is estimated at around Rs. 107.56 billion.
For context, the weekly Treasury Bill auction held last Wednesday (18), registered a positive outcome, with yields continuing to trend downward. The weighted average rates declined across all maturities for the fifth consecutive week. The shorter-tenor maturities saw a more pronounced downward adjustment, with the rate on the 91-day Bill declining by six basis points to 7.66% and the rate on the 182-day Bill dropping by eight basis points to 7.99%. The 364-day Bill saw its yield ease more modestly, by four basis points to 8.27%. The auction was fully subscribed, raising the entire Rs. 60 billion offered.
In addition, demand extended to the second phase, where an additional Rs. 6 billion—the maximum offered—was raised out of a total market subscription of a staggering Rs. 34.52 billion. Accordingly, the aggregate amount accepted at the issuance amounted to Rs. 66 billion.
The details of the upcoming Treasury Bond auction, scheduled to be conducted this Thursday (26) are as follows. The round of auctions will have a total offered amount of Rs. 140 billion across three available maturities.
The auction will be comprised of: Rs. 40 billion from a 1 March 2030 Maturity bearing a coupon rate of 9.50%; Rs. 60 billion from a 15 June 2034 Maturity bearing a coupon rate of 10.75%; Rs. 40 billion from a 1 July 2037 Maturity bearing a coupon rate of 10.75%; The settlement for which will be held on 3 March 2026.
The Government Securities secondary market trade volume as at 23 February was at Rs. 4.81 billion.
In money markets, the net liquidity surplus increased to Rs. 297.94 billion yesterday. The Domestic Operations Department (DOD) of the Central Bank of Sri Lanka was seen draining out an amount of Rs. 60 billion by way of overnight repo auction at a weighted average rate of 7.63% while an amount of Rs. 238.27 billion was deposited at Central Bank’s SDFR (Standing Deposit Facility Rate) of 7.25%. An amount of Rs. 0.33 billion was withdrawn from the Central Bank’s SLFR (Standing Lending Facility Rate) of 8.25%.
The weighted average rates on overnight call money and Repo stood at 7.68% and 7.71% respectively.
Forex market
In the forex market, the USD/LKR rate on spot contracts were seen closing the day mostly unchanged at Rs. 309.35/309.40 as against its previous day’s closing level of Rs. 309.36/309.38.
The total USD/LKR traded volume for 23 February 2026 was $ 98.10 million.
(References: Public Debt Management Office - Ministry of Finance, Central Bank of Sri Lanka, Bloomberg E-Bond Trading Platform, Money Broking Companies)
