Buying interest persists as yield curve tapers down further

By First Capital Research 

Secondary market participants yesterday maintained buying interest ahead of today’s T-Bill auction, leading to a further tapering down of the yield curve.

Notably, buying interest was predominantly centered on 2028, 2029, 2030 and 20231 maturities. Trading volumes and activity remained at moderate levels.

As a result, 2028 maturities traded in the range of 9.20% to 9.00%, while 2029 and 2030 maturities changed hands in the ranges of 9.80% to 9.60% and 9.75% to 9.70%, respectively. Meanwhile, 2031 maturities traded at a yield of 10.00%.

In the forex market, the LKR depreciated marginally against the greenback, closing at Rs. 299.6/USD, compared to the previously seen rate of 299.3/USD. 

Meanwhile, overnight liquidity in the banking system further expanded to Rs.203.2 billion from Rs. 192.2 billion in the previous session.

Additionally, the Weekly Average Weighted Prime Lending Rate for the week ending 23rd May 2025 declined by 11bps to 8.47%, compared to the previous week.