Market activity remains muted, keeping yields stable

By First Capital Research

The secondary market recorded subdued trading activity yesterday, leaving the overall yield curve largely unchanged.

Among the maturities traded, the 15.12.2032 bond changed hands at 10.85 percent, while the 01.06.2033 maturity traded at 11.00 percent. 

Further along the curve, the 15.06.2034 maturity traded at 11.17 percent. Finally, the 01.07.2037 maturity was seen trading at 11.25 percent, with these tenures drawing selling interest.

At the treasury bill auction, the PDMO raised Rs.126.9 billion, falling short of the initial offer of Rs.140.0 billion. The three-month, six-month and 12-month were accepted, totalling Rs.69.8 billion, Rs.25.3 billion and Rs.31.9 billion, respectively. 

The weighted average yield on the three-month bill declined to 8.20 percent, from 8.27 percent, while the six-month yield edged up by 2 bps to 8.25 percent. The 12-month yield remained unchanged at 8.52 percent.

On the external front, the Sri Lankan rupee depreciated against the US dollar, standing at Rs.318.69/US dollar, compared to Rs.317.92/US dollar seen the previous day. Liquidity in the banking system expanded to Rs.248.48 billion, from Rs.231.90 billion recorded previously.