Limited activity on the concluding day of the year

By First Capital Research 

The secondary market yield curve experienced a dull trading session on the concluding day of the year yesterday, witnessing thin trading volumes and limited activity.  As a result, the yield curve remained relatively unchanged following Wednesday’s bond auction where the CBSL fully accepted Rs. 80.0bn in bonds. 

Additionally, the CBSL announced the issuance of Rs. 168.0bn in treasury bills to be raised through an auction held on 1st Jan-25, where Rs. 43.0bn is to be raised for the 91-day T-Bill, Rs. 60.0bn is to be raised for the 182-day T-Bill, and Rs. 65.0bn is to be raised for 364-day T-Bill.  Notable trades were on the belly end of the curve, with the 2028, 2029, and 2032 maturities experiencing some interest. The trades were limited to the 15.10.28 maturity which was seen trading between rates of 10.42% - 10.38%. 

The 15.09.29 maturity was seen trading at a rate of 10.68%. Similarly, 01.07.32 traded at a rate of 11.46%. Meanwhile, on the external front, the LKR appreciated against the USD, closing at Rs. 292.58/USD compared to Rs. 292.75/USD recorded the previous day. 

Similarly, the LKR appreciated against other major currencies such as the GBP, EUR, AUD, and CNY. CBSL holdings of government securities remained unchanged, closing at Rs. 2,515.62bn yesterday. Overnight liquidity in the banking system expanded to Rs. 168.11bn from Rs. 158.37bn recorded the previous day.