Yield curve remains broadly stable amid mixed market sentiment

By First Capital Research

Sentiment in the secondary market remained mixed yesterday, with trading volumes at moderate levels. Investor interest was especially visible in the mid- to belly-end of the yield curve, while activity was primarily driven by primary dealers and banking sector participants. Foreign investor participation remained absent.

Among the maturities traded, 01.05.2028 and 15.10.2028 both traded between 10.60% to 10.65%. Moving ahead, 15.05.2030 and 01.08.2030 changed handswithin the range of 11.10% to 11.20% while01.11.2033 traded between 11.70% to 11.64%. Finally, 15.06.2034 was seen trading at a rate of 11.70%. 

On the external front, the LKR depreciated against the USD, standing at Rs. 334.54/USD, compared to Rs. 333.76/USD seen earlier. Liquidity in the banking system expanded to Rs. 64.26bn from Rs. 44.16bn recorded previously.

Popular maturities traded during the day: 01.05.2028:(-2bps), 15.10.2028: (-10bps), 15.05.2030: Unchanged, 01.08.2030: (-5bps), 01.11.2033: (-5bps).