Sri Lanka rupee ends slightly firmer, gilt yields down

ECONOMYNEXT- Sri Lanka’s rupee closed stronger at 182.00/182.05 to the US dollar in the spot market on Wednesday while bond yields fell, dealers said.

The rupee ended at 182.08/15 to the greenback on Tuesday.

Liquidity in the overnight money market was 18.96 billion rupees on Wednesday, marginally up from 18.83 billion rupees at previous days close.

Banks deposited 14.84 billion rupees through Central Bank’s excess liquidity window.

Central Bank mopped up 6.60 billion rupees at 6.99 percent in an overnight repo auction.

In another auction, Central bank wiped out 2.9 billion rupees at 7.11 percent in an overnight term reverse repo maturing in 8-days.

In the government securities market, bond yields were down in active trade while 2024 maturities remained liquid, dealers said.

In the weekly bills auction, rates fell across all maturities.

Dealers said the yields in the secondary market fell as a result of liquidity in the overnight market meanwhile the US cut its rates.

The US Federal Reserve announced an emergency rate cut Tuesday, responding to the growing economic risk posed by the coronavirus epidemic and giving President Donald Trump the stimulus, he has called for.

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In a unanimous decision, the Fed’s policy-setting committee slashed its key interest rate by a half point to a range of 1.0-1.25.

A bond maturing on 15.12.2021 closed at 9.70/85 percent on Wednesday, falling from 9.75/95 percent at Tuesday’s close.

A bond maturing on 01.09.2023 closed at 9.20/30 percent, down from 9.30/35 percent at its previous close.

A bond maturing on 15.09.2024 closed at 9.50/55 percent on Wednesday, falling from 9.62/67 percent at Tuesday’s close.

A bond maturing on 15.10.2027 closed at 9.70/80 percent easing from 9.80/95 percent at it’s the previous close.

A bond maturing on 15.05.2030 closed at 9.75/10.00 percent on Wednesday, sliding from 9.85/10.05 percent at Tuesday’s close.

A bond maturing on 15.09.2034 closed at 975/10.10 percent, falling from 9.85/10.10 percent from its last close.
(Colombo/Mar04/2020)

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