Increased activity emerges post auction

By First Capital Research

Yesterday’s Treasury Bill auction saw a sharp decline in rates across the board. The CBSL raised a total of Rs. 182.5bn with the total offered amount being fully accepted across all three maturities. 

The 03M T-Bill was fully subscribed at Rs. 42.5bn, the 06M T-Bill was fully subscribed at the offered amount of Rs. 60.0bn, and the 1 Yr T-Bill was fully accepted at Rs. 80.0bn. 

The weighted average yield rates saw declines, where the 03M bill saw a decline of 19bps at 7.93%, the 06M bill saw a decline of 16bps at 8.09%, and the 1 Yr bill saw a decline of 16bps at 8.47%. 

The secondary market yield curve experienced high activity amidst moderate trading volumes. Notable trades were amongst the 2027, 2028, 2029, and 2030 maturities. On the short end of the curve, 15.01.27, and 01.05.27 traded at rates of 9.15%, and 9.65% - 9.55%, respectively. 

On the belly end of the curve, 15.01.28, 15.02.28, and 15.03.28 traded between rates of 10.18% - 10.05%. Similarly, 01.05.28, and 01.07.28 traded between 10.35% - 10.25%, while 15.10.28, and 15.12. 28 traded between 10.45% - 10.38%. 15.09.29 traded between rates of 10.88% - 10.85%. 

The 15.05.30, 15.10.30, and 01.07.32 maturities traded between rates of 11.15% - 11.10%, 11.30%, and 11.45%, respectively. 

On the external front, the LKR appreciated against the USD closing at Rs. 297.9/USD compared to Rs. 298.5/USD recorded the previous day. 

CBSL holdings of government securities remained unchanged, closing at Rs. 2,511.92bn yesterday. Overnight liquidity in the banking system expanded to Rs. 184.05bn from Rs. 158.86bn recorded the previous day.