Secondary bond market yields hold steady; activity moderates

Wednesday, 2 July 2025 00:10 - - {{hitsCtrl.values.hits}}

Rs. 113 billion Treasury bill auction in focus; Rupee appreciates

By Wealth Trust Securities

The secondary bond market yesterday saw yields hold broadly steady. As such, the market was seen consolidating with yields trading within a narrow band. Market activity and transaction volumes were seen at moderate levels.

The 15.12.26 maturity traded at the rate of 8.05%. The 01.05.27 and 15.09.27 maturities traded at the rates of 8.35% and 8.45%-8.42% respectively. The 15.03.28 and 01.07.28 maturities traded 8.73%-8.72% and 8.82% respectively. The 15.12.29 traded at the rate of 9.40%. The 15.03.31 maturity traded at the rate of 10.00%.

This comes ahead of the Treasury bill auction due today. The auction will have on offer a total amount of Rs. 113 billion, an increase of Rs. 48 billion over the previous week. This will consist of Rs. 25 billion on the 91-day maturity, Rs 53 billion on the 182-day and Rs. 35 billion on the 364-day maturity.

For reference the weekly Treasury bill auction conducted last Wednesday went undersubscribed for a second consecutive week as only an amount of Rs. 60.49 billion or 93.05% of the total offered volume of Rs. 65.00 billion was accepted in successful bids. This was despite total bids received exceeding the offered amount by 1.86 times. Interestingly, the weighted average yield rate on the 182-day tenor increased marginally by 02 basis point to 7.75%. However, the weighted average yield rate on the 91-day tenor and 364-day tenors remained steady at 7.55% and 7.94% respectively.

The total secondary market Treasury bond/bill transacted volume for 30 June was Rs. 23.59 billion.

In money markets, the weighted average rates on overnight call money and Repo stood at 7.75% and 7.76% respectively. The net liquidity surplus was recorded to Rs. 110.76 billion yesterday.

Forex market

In the forex market, the USD/LKR rate on spot contracts closed the day appreciating marginally to Rs. 300.00/300.15 as against 300.15/300.30 the previous day.

The total USD/LKR traded volume for 30 June was $ 74.95 million.

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

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