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Sri Lanka fails to sell 58-pct of Treasuries auction

ECONOMYNEXT – Sri Lanka has failed to sell 58 percent of a 45 billion rupee Treauries auction amid price ceilings above which unsold bills have been monetized in the past, amid record balance of payments deficits, official data showed.

However the debt office which is a unit of the central bank had sold higher volumes of 3 month bills, small volumes of longer tenors were sold.

In 3-month bills the debt office sold 17.4 billion rupees at 5.08 percent up 03 basis points after offering 10 billion rupees.

In 6-month bills the debt office sold 1.27 billion rupees after offering 15 billion, at 5.12 percent, up 02 basis points.

In 12-month bills, the debt office sold only 200 million rupees up 04 basis points from two weeks ago.

The debt office raised a ceiling yield which has become a de facto policy rate above which money is printed 03 basis points to 5.15 percent in April from 5.12 percent in March.

Sri Lanka is printing money to keep rates down despite record balance of payments deficits. (Colombo/Apr08/2021)

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