Sri Lanka Treasuries yields edge up, 6-month bids rejected

ECONOMYNEXT – Sri Lanka’s Treasuries yields edged up across maturities at Wednesday’s auction with the 3-month yield up 07 basis points to 7.65 percent, data from the state debt office showed.

The 12-month yield grew 10 basis points to 8.51 percent.

All bids for 6-month bills were rejected.

The debt office, which is a unit of the central bank, offered 4.0 billion rupees of 3-month bills and accepted 6.4 billion rupees in bids.

It offered 8.0 billion rupees of 12-month bills and accepted 11.7 billion rupees. A total of 20 billion rupees in bills were offered but only bids of 18.2 billion rupees were accepted.

In the past the central bank used to reject bids and buy wholesale the printed money generating high inflation and balance of payments troubles. However after public criticism such tactics have been stopped.

Of late it has used open market operations to inject liquidity and generate BOP troubles and had also used ‘operation twist’ style tactics to manipulate the yield curve.

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