Sri Lanka rupee closes weaker, bond yields ease
Apr 18, 2019 17:17 PM GMT+0530 | 0 Comment(s)
ECONOMYNEXT- Sri Lanka's rupee closed at 174.50/60 to the US dollar in the spot market on Thursday, while bond yields eased, dealers said.
The rupee had closed at 174.45/60 to the US dollar in the spot market on Wednesday.
There were little currency trades as the holiday mood remained, dealers said.
Excess liquidity in overnight money markets reached 14.29 billion rupees on Thursday from a 6.49 billion rupee shortage a day earlier.
The Central Bank injected just 3.75 billion rupees in overnight and 7-day money, with most of the liquidity coming through banks depositing more through the standing facilities instead of borrowing following the holiday season, where there were higher withdrawals from the window.
Private credit is also lower, decreasing banks' demand for liquidity.
Dealers said yields in the bond market eased on buying pressure with the liquidity excess.
Market participants are expecting bond yields to fall at the next auction on April 29, following the Central Bank's dovish stance, signalling a possible rate cut in coming months, dealers said.
Dealers said there was heightened activity in the market in the morning session, before becoming dull in the afternoon.
Twelve month bills closed at 9.75/85 percent on Thursday, up from 9.70/80 percent at Wednesday's close.
A bond maturing on 15.12.2021 closed at 10.15/20 percent, down from 10.17/23 percent.
A bond maturing on 15.03.2022 closed at 10.32/38 percent, down from 10.40/44 percent.
A bond maturing on 15.03.2024 closed at 10.70/75 percent, stable from 10.70/75 percent.
A bond maturing on 15.01.2027 closed at 10.95/00 percent, down from 11.00/05 percent.
A bond maturing on 01.05.2029 closed at 11.10/15 percent on Thursday, unchanged from Wednesday.(Colombo/Apr18/2019-SB)