T-Bill auction undersubscribed after weeks with yields remaining still | Sunday Observer
Government Securities Market:

T-Bill auction undersubscribed after weeks with yields remaining still

5 February, 2023

The secondary market commenced the week on a dull note, as the market participants remained on the sidelines awaiting for a clear direction on the interest rates. The seven-week of descending trend of the weighted average yields at the weekly T-Bill auction halted, except for the one-year bill which continued to edge down by 6 bps.

As investors awaited a clear direction on the IMF front following the successful progression of the debt restructuring talks, the secondary market displayed subtle activities.

However, towards the end of the week, bond auction maturity July 1, 2025, displayed some mixed sentiment which traded within the range of 32.50%-32.85%.

The Central Bank of Sri Lanka (CBSL) conducted its primary bond auction for Rs. 70.0 bn and partially accepted Rs. 67.9 bn, of which Rs. 55.0 bn was accepted from the May 1, 2027 maturity at a weighted average yield of 29.21%. Despite the interest from investors on July 1, 2025 maturity, CBSL accepted Rs. 12.9 bn (from Rs. 15.0 bn offered) at a weighted average yield of 32.19%.

At the bill auction, CBSL partially accepted the offered after seven-weeks of continuous full acceptance, signaling a possible ease in future bill yields. Partial acceptance was observed across all three maturities with 91-day and 182-day bill yields closing unchanged at 29.91% and 28.72%. 364-day maturity yield edged down by 6bps to 27.72%.

In the Forex market, the rupee remained broadly steady against the greenback with rupee being recorded at Rs. 362.1 over the week.

Courtesy: First Capital Research (Feb 1)