Yield curve remains stable amidst measured activity

By First Capital Research 

The secondary market continued to reflect a mixed sentiment among participants during yesterday’s trading session, echoing the mixed sentiment observed the day before. Trading volumes remained moderate, while the yield curve remained broadly unchanged.

At the short end of the curve, the 15.02.2028 and 15.03.2028 maturities were actively quoted within the range of 9.65% to 9.60%. 

Meanwhile, towards the belly end of the curve, 15.06.2029 and 15.12.2029 maturities changed hands between 10.20% and 10.15%. 

Further along the curve, the 15.03.2031 maturity was seen trading at 10.70%.Notably, the 01.11.2033 maturity attracted foreign interest, trading at the rate of 10.95%, signalling selective appetite in the longer end of the curve.

In the forex market, the LKR depreciated against the greenback, closing at Rs. 299.5/USD, compared to the previously seen rate of 298.8/USD. 

Meanwhile, overnight liquidity in the banking system expanded to Rs. 174.1bn from Rs. 157.9bn in the previous session.