Secondary market yields tick higher post-T-bond auction

By First Capital Research

The week started with the first T-bond auction for 2026, where the yields edged up at the auction. 

Among the trades that executed prior to the auction, 15.03.2028 traded at 9.10 percent and 01.09.2028 traded at 9.22 percent. The 15.09.2029, 15.10.2029 and 15.12.2029 maturities traded in the range of 9.61 percent-9.65 percent. Additionally, over the mid-term, 15.05.2030 traded at 9.75 percent. At the T-bond auction, the 2035 maturity was accepted at a higher rate, pushing up the yields. Thereby, 15.06.2035 changed hands at a higher range of 11.20 percent-11.18 percent. 

At the T-bond auction held yesterday, PDMO raised a total of Rs.184.8 billion, against an offered amount of Rs.205.0 billion, while the yields increased across all the maturities. The 01.03.2030 and 01.06.2033 maturities were accepted in full, amounting to Rs.50.0 billion and Rs.40.0 billion, while the weighted average yields rose to 9.74 percent and 10.65 percent, respectively. Acceptances on the 15.06.2035 bond was Rs.54.8 billion, lower than its offer of Rs.75.0 billion, while the yield went up to 11.08 percent. Moreover, the 15.08.2039 maturity was also accepted in line with the offer of Rs.40.0 billion, inching up the yield to 11.09 percent.

On the external front, the Sri Lankan rupee appreciated against the US dollar, closing at Rs.309.38/US dollar, compared to Rs.309.72/US dollar recorded the previous day. Overnight liquidity in the banking system contracted to Rs.168.9 billion, from Rs.171.0 billion recorded previously.