Sri Lanka rupee ends weaker, bond yields up

ECONOMYNEXT- Sri Lanka’s rupee closed weaker at 182.55/65 to the US dollar in the spot market on Monday while bond yields gained, dealers said.

The rupee ended at 181.85/00 to the greenback on Tuesday.

Liquidity in the overnight money market 38.57 billion rupees, up from 37.04 billion rupees at previous day’s close.

There was no repo auction for the day.

Banks deposited 38.58 billion rupees through Central Bank’s excess liquidity window.

Sri Lanka’s debt office is offering 32 billion rupees at tomorrows weekly bills auction split in to 9 billion rupees maturing in 3-months, 7 billion rupees maturing in 6-months and 16 billion rupees maturing in 12-months.

On March 12, 2020, the debt office is also issuing 60 billion treasury bonds in auction.

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

Dealers said there was considerable selling pressure and the foreign investors exited the market.

A bond maturing on 15.12.2021 closed at 8.80/9.00 percent on Monday, up from 8.50/60 percent at Friday’s close.

A bond maturing on 01.09.2023 closed at 9.40/55 percent, climbing from 9.25/35 percent at the previous day’s close.

A bond maturing on 15.09.2024 closed at 9.60/65 percent on Monday, from 9.42/48 percent at Friday’s close.

A bond maturing on 15.10.2027 closed at 9.85/10.00 percent up from 9.58/68 percent.

A bond maturing on 15.05.2030 closed at 9.90/10.15 percent on Monday, gaining from 9.70/90 percent at Friday’s close.

A bond maturing on 15.09.2034 closed at 9.85/25 percent, climbing from 9.85/10 percent at the previous day’s end.

World oil prices crashed on Monday, fueling a vicious selloff on stock markets that were already buckling from the spreading coronavirus outbreak.

Stocks tanked as the global oil market nosedived 30 percent at one stage after top exporter Saudi Arabia slashed the prices it charges customers following a bust-up with Russia over crude production cuts.

As the coronavirus claims more lives around the world, dealers are shedding riskier assets for safe haven investment, sending gold and the yen surging and pushing US Treasury yields to record lows while the dollar was broadly lower against the yen, euro and other currencies, reported AFP.

While governments and central banks have unleashed, or are preparing to unleash, stimulus measures, the spread of COVID-19 is putting a huge strain on economies and stoking concerns of a worldwide recession.
(Colombo/ Mar10/2020)