Yield curve stable following heavy selling pressure

By First Capital Research

The secondary market yield curve remained broadly steady during yesterday’s session amidst limited activities. Slight buying interest emerged on some mid tenors reversing the selling pressure that prevailed in the previous sessions amidst the spike in last bond auction yields. 

On the short end, 2-year maturities, 01.02.2026 traded at 10.70% while 01.06.2026 and 01.08.2026 registered trades at 11.10%. Moreover, 15.12.2027 maturity closed at 12.20% during the day. On the 2028 tenor, trades were observed on 01.05.2028 and 01.07.2028 which closed transactions at 12.80%. 

Moreover, 15.12.2028 changed hands at 13.00%. On the belly of the curve, 15.06.2029 and 15.09.2029 recorded trades at 13.05% and 13.10%, respectively. 

Meanwhile, 15.05.2030 closed at 13.20% and 01.10.2032 closed at 13.30%. Investors continue to maintain a cautious stance amidst the looming uncertainties within the political arena of the country. 

On the external side, the LKR slightly depreciated against the greenback closing at Rs. 299.3 compared to the previous day’s closing of Rs. 299.2. 

Similarly, the rupee also depreciated against the EUR but appreciated against other currencies including GBP, CNY, AUD and JPY. 

Meanwhile, overnight liquidity decreased to Rs. 90.5 billion compared to the previous day while CBSL Holdings remained unchanged at Rs. 2,575.6 billion.