Buying appetite tones down ahead of bond auction

The secondary market yield curve remained broadly unchanged, as the robust buying sentiment, which persisted during the previous sessions, toned down during the day, as the investors boarded the sidelines ahead of the Rs.55.0 billion worth bond auction scheduled to take place today. 
However, a limited buying appetite was observed on bills, while majority of the interest centred on the six-month maturity. Meanwhile, on the bond side, July 01, 2028 registered trades between 12.05 percent and 12.11 percent, while September 15, 2027 hovered between 11.70 percent and 11.78 percent. 
On the external side, the LKR remained broadly steady against the USD, closing at Rs.313.0 during the day. Moreover, the weekly average weighted prime lending rate (AWPR) for the week ending February 09, 2024 decreased by eight basis points to 11.83 percent compared to the previous week. Further, foreign holding of government securities for the week ending February 09, 2024 closed at Rs.111.1 billion, recording a decline of Rs.3.3 billion (-2.9 percent week-on-week). 

The Central Bank is expected to raise Rs.55.0 billion worth bonds at the auction scheduled on February 13, 2024, with Rs.30.0 billion raised from the December 15, 2026 maturity while Rs.25.0 billion shall be raised from the December 15, 2028 maturity.