Sri Lanka fails to sell 80-pct of Treasuries at auction

ECONOMYNEXT – Sri Lanka has failed to sell 80 percent of Treasury bills offered at an auction on Wednesday, official data showed amid possible yield curve targeting.

The debt office, which is a unit of the central bank offered 8.0 billion rupees of 3-month bills and sold only 1.12 billion rupees of bills, at an average yield of 4.61 percent almost unchanged from 4.60 percent a week earlier.

The debt office offered 13.0 billion rupees of 6-month bills and sold 3.15 billion rupees, at 4.73 percent, marginally up from 4.73 percent a week ago.

After offering 19 billion rupees of 13-month bills, 3.35 billion rupees of bills were sold at 4.98 percent, compared to 4.97 percent a week ago.

The debt office offered a total of 40 billion rupees of bills and sold only 7.65 billion rupees, failing to sell 32.3 billon rupees of 80 percent of the offering.

Related

Sri Lanka fails to sell 35-pct of bonds offered at auction

Sri Lanka also failed to sell all bonds offered at an auction earlier this week.

The central bank has been purchasing large volumes of government securities boosting their domestic asset portfolio and expanding reserve money.

Some of the liquidity has gone out as foreign reserve outflows in the repayment of government debt, while private credit is weak. However asset prices especially in stocks have gone up.
(Colombo/Nov18/2020)

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  1. It does not augur well for the government. Share prices appreciated because people prefer investing in shares is better than buying bonds, treasury bills or in FDs or saving accounts since the yields are very poor

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