ECONOMYNEXT – Sri Lanka’s bond yields eased around 20 to 25 basis points, Friday dealers said, after a 100 basis point policy rate cut to 10 percent.
The central bank said with the latest rate cut “sufficient monetary easing has been effected in order to stabilise inflation over the medium term.”
Sri Lanka rupee was flat at 328.75/329.00 to the US dollar steady from Thursday’s close of 328.75/80 percent.
Sri Lanka’s bond yields have gradually eased in recent months from currency crisis levels as government finances improved and private credit was negative, despite real savings being inflated away in the rupee collapse.
The first review of the IMF program is also expected as soon as India and the Paris Club gives their debt restructuring proposal. China has already given a proposal covering the bulk of its debt classified as official.
A bond maturing on 01.06.2025 was quoted at 13.95/14.10 down from Thursday’s close 14.20/35 percent.
A bond maturing on 01.08.2026 was quoted at 14.25/40 percent down from 14.35/50 percent.
A bond maturing on 15.01.2027 was quoted at 14.40/50 down from 14.55/60 percent.
A bond maturing on 01.07.2028 was quoted at 14.50/45 percent down from 14.60/80 percent.
A bond maturing on 15.05.2030 was quoted at 14.20/40 down from 14.40/50 percent a day earlier. (Colombo/Nov24/2023)