Sri Lanka rupee opens firmer, bond yields fall
Wednesday May 29, 2019 10:26
ECONOMYNEXT – Sri Lanka’s rupee opened firmer at 176.10/25 to the US dollar in the spot market on Wednesday and gilt yields were steady, dealers said.
The rupee closed at 176.20/30 to the US dollar in the spot market on Monday.
The bond market was moderately active, dealers said.
Yields fell Wednesday morning, especially on longer maturities, as market participants bought ahead of the weekly bill auction.
The state debt office will be selling 20 billion rupees in bills, split into 2 billion rupees in 3-month, 4 billion rupees in 6-month and 14 billion rupees in 12-month maturities
Rates had risen or remained stable over the past four market days amid trading, with some seeking quick profits.
However, yields have been on the decline overall in the past month and a half, with excess liquidity and a slowdown in private credit growth.
Markets are expecting the central bank to announce a policy rate cut on Friday, which is also influencing buying today, dealers said.
A bond maturing on 15.12.2021 was quoted at 9.40/45 percent on Wednesday, stable from 9.40/55 percent at Tuesday’s close.
A bond maturing on 15.03.2023 was quoted at 9.77/83 percent, falling from 9.85/90 percent.
A bond maturing on 15.03.2024 was quoted at 9.92/98 percent, down from 9.98/10.03 percent.
A bond maturing on 01.08.2026 was quoted at 10.20/27 percent, falling from 10.25/30 percent.
A bond maturing on 15.01.2027 was quoted at 10.28/33 percent on Wednesday, down from 10.38/43 percent at the previous close.
A 10-year bond maturing on 01.05.2029 was quoted at 10.45/52 percent, falling from 10.55/60 percent.
At the Colombo Stock Exchange, the All Share Price Index (ASPI) was up 0.15 percent or 7.92 points to 5,301.41 in the first half hour of trading.
The more liquid S&P SL20 Index was up 0.49 percent or 12.07 points to 2,476.22.
Market turnover was 15 million rupees, with 29 stocks up and 8 down.
Two thirds of the turnover was through Central Finance Company, which was trading flat at 83 rupees a share.
Commercial Bank contributed most to the ASPI gain, trading 1.10 rupees up at 93 rupees a share, followed by Dialog Axiata, trading 10 cents up at 9.40 rupees a share. (Colombo/May29/2019)