Secondary market bond yields broadly steady in thin trade

Friday, 24 April 2015 01:18 - - {{hitsCtrl.values.hits}}

By Wealth Trust Securities Activity in secondary bond markets was seen dipping yesterday as yields was seen closing the day broadly steady against its previous day’s closings. Following the news of the cabinet approval granted to the Indian Government for a $ 1.5 billion swap between the Central Bank of Sri Lanka (CBSL) and the Reserve Bank of India (RBI), buying interest in morning hours of trading saw yields on the liquid maturities of 1 June 2018, 15 September 2019, 1 June 2020, 1 August 2021, 1 July 2022 and 1 September 2023 dip to intraday lows of 7.83%, 8.17%, 8.45%, 8.53%, 8.55% and 8.79% respectively. However, profit taking at these levels curtailed the downward movement as activity moderated towards the latter part of the day. In money markets yesterday, the downward trend in overnight call money and repo rates continued, to average 6.15% and 6.00% respectively as surplus liquidity remained high at Rs. 132.95 billion. Furthermore, the Open Market Operations (OMO) department of Central Bank announced its first liquidity management auction in one month at where it plans on draining a total amount of Rs. 25 billion from the system by way of outright sales of Treasury bills for periods of 32 days, 53 days and 67 days. The auction will be conducted today with settlements due on Monday 27 April. Activity shifts to one month forward contracts in forex markets Meanwhile in forex markets yesterday, activity was seen shifting to one month forward contracts as it closed the day at Rs. 134.75/00 against its previous day’s closing levels of Rs. 134.40/60. The total USD/LKR traded volume for 22 April was at $ 67.50 million. Some of the forward dollar rates that prevailed in the market were: three months – 135.82 and six months – 137.37.

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