Sri Lanka bond yields extend fall on DDR comments

Treasury bill averages continue to decline,
The downward momentum at the weekly Treasury bill auction was seen continuing at its auction held yesterday as weighted average rates decreased across all three maturities for a second consecutive week.

Forex market _
In the forex market, the middle rate for USD/LKR spot contracts remained steady at Rs. 363.50 yesterday. The total USD/LKR traded volume for 22 November was $ 95.21 million.

CSE gathers more strength,
The Colombo stock market gathered more strength with indices gaining by over 2% thanks to improved investor sentiment.

https://www.ft.lk/financial-services/Treasury-bill-averages-continue-to-decline/42-742299

The deceleration in inflation is expected to continue in the ensuing period, supported by subdued aggregate demand pressures, expected improvements in domestic supply conditions, normalisation in global commodity prices, and the timely passthrough of such reductions to domestic prices, along with the favourable statistical base effect.

https://www.lankabusinessonline.com/deceleration-in-inflation-expected-to-continue-in-ensuing-period-central-bank/?amp=1

Sri Lanka bond yields down, kerb rate 371/372.50 (The kerb rate for the US dollar was 371.00/372.50 down from 371.50-373.00 last week)

In the weekly analysis report issued by the Fitch ratings said, in the secondary market buying interest was largely witnessed during the week possibly due to the improvement in banking system liquidity and speculation on a policy rate easing.

https://economynext.com/sri-lanka-bond-yields-down-kerb-rate-371-372-50-104286/

Sri Lanka bond Yields down

ECONOMYNEXT – Sri Lanka’s treasuries yields fell on Monday on moderate trade, dealers said.

Rates of mostly long term tenants came down, maybe because the Central bank not offering long term tenants in the bond auction can be the reason” dealers said.

https://economynext.com/sri-lanka-bond-yields-down-104470/

Sri Lanka’s treasury bill yields eased on active trade after the bond auction on Tuesday while the Central Bank’s guidance peg for interbank transactions fell 19 cents, dealers said.

“The secondary bond market showcased lackluster sentiment following the primary auction for LKR 50.0Bn treasury bonds held today. The sentiment observed during the proceedings was due to the wait and see approach adopted by the investors, amidst speculation of interest rates easing,” First Capital Market Research said in it’s day note.

https://economynext.com/sri-lankas-bonds-t-bills-ease-on-active-trade-104552/

ECONOMYNEXT – Sri Lanka’s bond yields fell at open on Friday on active trading with buying interest continuing, while T-bills were not quoted, dealers said.

“The market is highly active with the trading continues and the T-bond yields have drastically come down” a dealer said.

A bond maturing on 01.05.2024 closed at 30.40/60 percent on Friday, down from 31.90/32.10 percent on Thursday.

A bond maturing on 15.05.2026 closed at 29.00/30 percent down from 30.50/80 percent.

The Central Bank’s guidance peg for interbank transactions was flat at 363.19 rupees against the US dollar. (Colombo/ Dec 01/2022)

ECONOMYNEXT – Sri Lanka’s bond yields edged down Friday while a guidance peg for the US dollar was unchanged and market participants said the kerb rate was 370/372 rupees to the dollar.

A bond maturing on 01.05.2024 closed at 31.00/63 percent on Friday, down from 31.90/32.10 percent at close on Thursday.

A bond maturing on 15.05.2026 closed at 29.50/75 percent down from 30.50/80 percent.

A bond maturing on 15.01.2028 ended at 26.30/27.30 percent on Friday, down from its last closing at 27.00/30 percent.

Dealers said with more buying interest revolved around T-bonds, no bills were quoted for the day.

The Central Bank’s guidance peg for interbank transactions remained unchanged at 363.19 rupees against the US dollar.

Commercial banks offered dollars for telegraphic transfers between 371.79 and 372.10 for small transactions, data showed.

Buying rates are between 361.79 – 362.00 rupees.

Bond market activity continues at moderate pace
The activity level in the secondary bond market continued at a moderate pace yesterday as the liquid maturities of 01.05.24, 15.01.25 and 15.05.26 changed hands at yields of 31.75%, 32.50% to 32.80% and 30.60% to 31.05% respectively against its previous day’s closing levels of 31.50/31.80, 32.00/32.50 and 30.75/31.25.

In addition, maturities of 15.07.29 and 01.07.32 traded at yields of 27.75% to 28.00% and 26.50% to 27.25% respectively. In secondary bills, trades were reported on January-February, March and June, along with December 2023 maturities at levels of 25.50% to 28.50%, 30.00% to 31.00%, 32.00% to 32.20% and 29.00% respectively.

The total secondary market Treasury bond/bill transacted volume for 14 December 2022 was Rs. 81.93 billion.

In money markets, an amount of Rs. 365.41 billion was deposited at Central Banks SDFR (Standard Deposit Facility Rate) of 14.50% while the weighted average rates on overnight call money and REPO stood at 15.50% each.



Forex Market

In the Forex market, the middle rate for USD/LKR spot contracts remained steady at Rs. 363.18 yesterday.

The total USD/LKR traded volume for 14 December was $ 26.35 million.

(References: Central Bank of Sri Lanka, Bloomberg E-Bond trading platform, Money broking companies)

ECONOMYNEXT – Sri Lanka sold all 85 billion rupees offered bills at Wednesdays auction with yields edging down across maturities data from the state debt office showed.

The debt offices sold 67.3 billion rupees of three months bills after offering 40 billion at 32.67 percent, down 13 basis points from a week earlier.

10.06 billion rupees of 6-month bills were sold after offering 25 billion rupees at 32.26 percent, down three basis points.

7.6 billion rupees of 12-month bills were sold after offering 20 billion rupees, at 29.30 percent, down two basis point.

Debt office offered 85 billion rupees of treasury bills and sold all. (Colombo/ Dec 21/2022)

T-Bill sales synchronise after two years
By Paneetha ameresekere - January 5, 2023 2:00am0

Yesterday’s weekly Treasury (T) Bill auction for the first time after a near two year hiatus saw perfect synchrony, with Central Bank of Sri Lanka (CBSL) being able to sell all of the offered tenures, whilst ensuring that the weighted average yields (WAYs) fell for the fourth consecutive market week in a row.

Consequently, CBSL sold all the Rs 98,000 million
T-Bills offered at yesterday’s tenure, allowing for a 100 per cent subscription for each of the tenures offered. Subsequently, CBSL sold all of the 91,182 and 364 – day tenures offered at yesterday’s auction, with their splits being Rs 60,000 million, Rs 20,000 million and
Rs 18,000 million, respectively.

The WAYs fetched for the 91, 182 and 364 – day tenures at yesterday’s auction were 32.01 per cent, 32.02 per cent and 29.16 per cent, down 63 basis points (bps), 18 bps and 10 bps each, week on week (WoW), respectively.

Nonetheless, the fact that the WAY of the 364 maturity being smaller than both the 91 and 182 – day maturities for the nineteenth consecutive market week to yesterday and that of only the 91 – day maturity for the twentieth consecutive market week to yesterday is an indication that the market expects yield pressure to last only in the short term.

Meanwhile, the last time such perfect synchronization as described above took place was at the 20 January 2021 T-Bill auction, where Rs 40,000 million were offered and taken, with the splits 100 per cent subscribed being Rs 12,000 million, Rs 5,000 million and Rs 23,000 million, respectively, vis-à-vis the 91, 182 and 364 day maturities offered.

The WAYs fetched at the 20 January 2021 auction were 4.70 per cent, 4.77 per cent and 4.99 per cent for the 91, 182 and 364 – day maturities, unchanged WoW vis-à-vis the 91 – day maturity and down one and three bps each vis-à-vis the other two maturities, iethe 182 and 364 – day maturities, respectively.

In related developments, CBSL on behalf of the GoSL, will, by Monday, have to repay to the market at least Rs 93,228 million worth of maturing T-Bills. However, maturing T-Bills due to the CBSL by Monday are unknown as CBSL doesn’t disclose such figures.

Additionally, T-Bill maturities comprising a cumulative total of Rs 17,500 million of all three maturities, 91, 182 and 364 – day maturities, the splits of which are however unknown, but are also due to the market, of which 91 day maturities have already been repaid and of which the 182 – day maturity of unknown value is also due for repayment by Monday.

In like developments, the splits of the known maturities of Rs 93,228 million due for repayment to the market by Monday are Rs 76,421 million worth of 91- day maturities, Rs 15,809 million 182 – day maturities and Rs 998 million 364 – day maturities, respectively. CBSL is the steward of GoSL debt.

Usually, investments in T-Bill are risk free, because CBSL, which is mandated to print money and if GoSL is unable to repay such debt, generally, CBSL is mandated to print demand pull inflationary money and repay such creditors. Domestically, issuing of T-Bills is a key instrument used by GoSL to raise money locally.

Sri Lanka printed money for 75 years and defaulted, but now has to stop: Minister

https://economynext.com/sri-lanka-printed-money-for-75-years-and-defaulted-but-now-has-to-stop-minister-108846/

Sri Lanka t-bill yields fall across maturities at auction

ECONOMYNEXT – Sri Lanka has sold 110 billion rupees of Treasury bills at an auction on Tuesday after offering 110 billion while yields across maturities fell, data from the state debt office showed.

The debt office sold all of the offered 60 billion rupees in 3-month bills at 24.12 percent, down 187 basis points from a week earlier.

Only 14.1 billion rupees in 6-month bills were sold at 24.10 percent, down 169 basis points from a week earlier.

35.8 billion rupees of 12-month bills were sold at 22.37 percent, down 176 basis points from a week earlier after offering only 20 billion. (Colombo/April04/2022)