Mixed sentiment prevails ahead of T-Bill auction

By First Capital Research 

The secondary market yield curve witnessed a day of mixed sentiment amidst the presence of both buying and selling activity yesterday.

The yield curve remained relatively stable ahead of today’s treasury bill auction, where the CBSL is scheduled to raise Rs. 102.0bn in T-Bills, where Rs. 30.0bn is to be raised from the 91-day maturity, Rs. 30.0bn is to be raised from the 182-day maturity, and Rs. 42.0bn is to be raised from the 364-day maturity. 

Notable trades were on the short to mid end of the curve, primarily amongst the 2026, 2027, 2028, 2030, and 2032 maturities. On the short end of the curve, 15.05.26, and 01.08.26 both traded between rates of 9.30% - 9.25%. 
Similarly, 15.01.27 traded at a rate of 9.58%. On the belly end of the curve, 15.01.28, and 15.02.28 traded between rates of 10.20% - 10.15%. 01.07.28 traded at 10.44% and 15.10.28 traded at a rate of 10.52%. Additionally, 15.10.30 traded at a rate of 11.15%, while 01.07.32 and 01.10.32 both traded at 11.48%. 

On the external front, the LKR depreciated against the USD, closing at Rs. 294.93/USD compared to Rs. 293.56/USD recorded the previous day. CBSL holdings of government securities remained unchanged, closing at Rs. 2,515.62bn yesterday. Overnight liquidity in the banking system contracted to Rs. 136.22bn from Rs. 162.73bn recorded the previous day.