Secondary Bond market extends recovery driving rates lower

Friday, 16 January 2026 00:06 - - {{hitsCtrl.values.hits}}

Money market liquidity increases

By Wealth Trust Securities

The secondary Bond market on Wednesday opened on a stronger footing, with yields continuing to recover on the back of further renewed buying interest. Market activity and transaction volumes were seen at elevated levels. Market depth increased considerably, with multiple sizeable block trades transacted, suggesting the activation of balance-sheet driven demand. Flows indicated strategic accumulation, as market participants locked in at the higher yield thresholds, in turn driving yields lower from their intraday highs.

In terms of the secondary Bond market trade summary, the 15.05.26 and 01.06.26 traded within the range of 8.42%-8.40%. The 15.03.28 maturity traded down the range of 9.15%-9.10%. The 01.05.28 maturity traded at the rate of 9.20% and the 01.07.28 traded down the range of 9.28%-9.22%. The 15.10.28 maturity traded down the range of 9.35%-9.25%. 15.12.28 maturity traded down the range of 9.35% to 9.30%.

The 15.06.29 traded at the rate of 9.65% and the 15.09.29 maturity traded at the rate of 9.70%. The 15.10.29 and 15.12.29 maturities traded down the ranges of 9.72%-9.70% and the 9.75%-9.71% respectively. The 01.03.30 maturity traded at the rate of 9.75%. The 15.03.31 maturity traded at the rate of 10.15%.

The 15.06.35 maturity saw concentrated demand and sizeable volumes transacted resulting in its yield declining down the range of intraday highs to lows of 11.25% to 11.17%.

The total secondary market Treasury Bond/Bill transacted volume for 13 January 2026 was Rs. 18.53 billion.

In money markets, the net liquidity surplus increased to Rs. 182.72 billion as an amount of Rs. 182.81 billion was deposited at Central Bank’s SDFR (Standing Deposit Facility Rate) of 7.25%. An amount of Rs. 0.10 billion was withdrawn from the Central Bank-s SLFR (Standard Lending Facility Rate) of 8.25%.

The weighted average rates on Call Money and Repo were registered at 7.96% and 7.97% respectively.

Forex market

In the Forex market, the USD/LKR rate on spot contracts closed the day depreciating to Rs. 309.35/309.50 as against Rs. 309.20/309.30 the previous day. The total USD/LKR traded volume for 13 January was $ 78.38 million.

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