By First Capital Research

The secondary market yield curve remained broadly stable, reflecting subdued activity and thin trading volumes across the market. 

Among the traded maturities, 01.08.26 bond was traded at 10.52%, while the 2027 maturities including 01.05.27, 15.10.27, and 15.12.27 traded at 11.50%, 11.75%, and 11.80%, respectively. 

Investor interest also extended to the 2028 maturities, with 15.02.28 and 15.03.28 bonds trading at 12.10% and 12.15%. On the longer end of the curve, 15.09.29 and 15.10.30 bonds were exchanged at 12.30% and 12.75%, respectively. 

Moreover, in the forex market, the LKR remained stable against the USD settling at Rs. 302.45.However, LKR marginally depreciated against other major currencies such as the AUD, GBP, and EUR. 

Meanwhile, overnight liquidity for the day was recorded at Rs. 72.5bn while CBSL holdings remained steady at Rs. 2,575.6bn. Despite a year-on-year increase in headline inflation to 2.4% in July 2024, up from 1.7% in June 2024, the rise in inflation was primarily driven by increases in both food and non-food categories. 

Food inflation climbed to 1.5%, while non-food inflation rose to 2.8%. Despite these upward pressures on the headline figure, core inflation remained steady at 4.4%.