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Sri Lanka bond yields edge up, rupee at new historic low

ECONOMYNEXT – Sri Lanka bond yields edged up at the close while the rupee traded while the rupee hit a new historic low in forward markets dealers said as stock markets were closed over Coronavirus, dealers said.

The rupee had traded around 195.50 to 196.00 to the US dollar levels in the one week forward market, dealers said. The rupee had been quoted at even lower levels in one year forwards, implying an even lower closing Friday dealers said.

The rupee closed around 192.50/193.00 to the US dollar in the one week forward market on Thursday with some trades around 192 levels, dealers said.

The rupee had come under pressure after unprecedented liquidity injections were made by the Central Bank despite operating a soft-peg with little credibility.

Liquidity in the overnight money market was 118.09 billion rupees, up from 63.14 billion rupees on Friday, amid a new injection.

Banks deposited 118.35 billion rupees in the central bank’s excess liquidity window.

In the secondary government securities market, yields edged up in moderate trading, dealers said.

Dealers also said that the 2023 and 2024 maturities were more liquid.

A bond maturing on 15.12.2021 quoted 8.20/50 percent on Friday, up from 8.00/25 percent.

A 2-year bond maturing on 01.10.2022 was quoted at 8.80/85 percent down from 8.80/90 percent.

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A bond maturing on 01.09.2023 was quoted at 9.20/25 percent, up from 9.15/25 percent yesterday.

A bond maturing on 15.09.2024 was quoted at 9.30/40 percent.

A bond maturing on 15.10.2027 was quoted at 9.55/70 percent up from 9.45/65 percent at yesterday’s close.

A bond maturing on 15.05.2030 was not quoted.

A bond maturing on 15.09.2034 was not quoted. It closed at 10.00/40 percent in its last close.
(Colombo/ Apr03/2020)