Sri Lanka rupee ‘moral suasion’ rate weakened, bonds steady

COLOMBO (EconomyNext) – Sri Lanka rupee was allowed to fall 20 cents to 133.70 to the US dollar in the spot market by authorities where there is no active trading, while bond markets were steady after a Treasuries auction, dealers said.

The Central Bank does not allow active trading in Sri Lanka’s spot forex market but the rate is unofficially indicated by authorities for benchmarking swap deals or a seller of last resort transactions.

Three months forward dollars were quoted at 136.45/50 rupees Wednesday, making the implied spot US dollar rate based on interest rate differentials about 134.65/85 rupees, dealers said.

Sri Lanka gets into frequent balance of payments trouble by trying to control both interest rates and the exchange rate at the same time, amid deteriorating fiscal policy.

At Wednesday’s auction the 3-month Treasury bill yield fell 02 basis points to 6.08 percent, the 6-month yield by 03 basis points to 6.19 percent and the 12-month was flat at 6.31 percent.

After the auction one bills were quoted around 6.25/35 percent, dealers said.

Other bonds also closed around the same levels as Tuesday dealers said.

Following are closing rates quoted for bonds of different tenors.

2-year 15.05.2017 bonds closed at 6.80/90 percent.

3-year 01.06.2018 bonds closed at 7.65/68 percent.

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4-year 01.07.2019 bonds closed at 7.98/8.02 percent.

5-year 01.05.2020 bonds closed at 8.15/25 percent.

6-year 01.08.2021 bonds closed at 8.37/40 percent.

7-tear 01.07.2022 bonds closed at 8.47/54 percent.

8-tear 01.09.2023 bonds closed at 8.68/72 percent.

9-year 01.01.2024 bonds closed at 8.80/85 percent.

10-year 15.03.2025 bonds closed at 8.96/90 percent.

20-year 15.03.2035 bonds closed at 10.00/10 percent.

30-year 01.03.2045 bonds closed at 10.75/11.20 percent.
 

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