Auction yields of 3m and 1yr bills held steady

By First Capital Research

The Central Bank conducted the weekly T-bill auction yesterday, raising Rs.192.5 billion and fully accepting the total offered. The six-month bill saw an oversubscription at yesterday’s auction while the three-month bill saw a full subscription of the offered amount whilst the one-year bill was undersubscribed. Meanwhile, the weighted average yield rates of the three-month and one-year bills remained unchanged at 8.73 percent and 9.08 percent, respectively. However, the six-month bill saw a marginal decline of three bps, closing at 8.94 percent. 

In the secondary market, activities saw a mixed interest while volumes improved to moderate levels. On the short end of the curve, various maturities from the 2027 bond enticed trades. Accordingly, 01.05.2027, 15.09.2027, 15.10.2027 and 15.12.2027 registered trades between 10.15 percent-10.30 percent. On the 2028 bond, 15.01.2028, 15.02.2028, 01.05.2028 and 01.07.2028 hovered between 10.45 percent-10.60 percent. Moreover, the 01.12.2031 maturity closed transactions between 11.43 percent-11.40 percent. 

On the external side, the Sri Lankan rupee continued to appreciate against the greenback, closing at Rs.290.5/US dollar, compared to the previous day’s closing of Rs.290.6/US dollar. However, on the contrary, the rupee depreciated against the other major currencies, including the GBP, EUR, JPY and CNY. On the other hand, overnight liquidity sharply increased to Rs.222.1 billion, compared to Tuesday’s close of Rs.127.9 billion while the Central Bank holdings remained stagnant at Rs.2,515.62 billion.