Buying interest returns, long tenors see foreign demand

By First Capital Research 

Yesterday, the secondary market broke from the lethargy that had persisted throughout the week. Market participants displayed buying interest, with the long end of the curve attracting foreign interest. The session was characterized by elevated volumes, despite a relatively moderate number of trades. 

At the short end of the yield curve, 15.10.2028 traded at 9.00%. In terms of 2029 maturities, 15.10.2029 and 15.12.2029 traded at 9.46% and 9.52% respectively. Moving ahead, 15.03.2031 maturity was seen changing hands at 10.06%. Finally, both 15.12.2032 and 01.11.2033 attracted significant foreign buying interest with the 2032 maturity trading between 10.45% to 10.35% and the 2033 maturity trading between 10.82% to 10.77%. 

In the forex market, the LKR depreciated against the greenback, closing at Rs. 302.20/USD, compared to the previously seen rate of Rs. 302.04/USD. 

Meanwhile, overnight liquidity in the banking system expanded to Rs. 114.1bn from the previously seen level of Rs. 106.2bn.