- Seventh consecutive weekly auction goes undersubscribed
- Liquidity shortfall increases sharply; Hits over a seventeen year high
The weekly Treasury bill auction conducted yesterday went undersubscribed for a seventh consecutive week as only 36.86% or Rs.25.21 billion was accepted in total against a total offered amount of Rs.68.5 billion.
All three weighted average rates continued to rise, recording increases of 05 basis points each and 03 basis points on the 91 day, 182 day and 364 day maturities respectively to 5.92%, 5.95% and 5.96%. The bids to offer ratio decreased to 1.21:1. Given below are the details of the auction,
The dull to lethargic sentiment in the secondary bond market continued yesterday as well, with only the short tenure 15.03.22 maturity changing hands at a level of 5.90%. In secondary bills, 10th September 2021 maturity traded at a level of 5.90%, pre-auction.
The total secondary market Treasury bond/bill transacted volume for 31st of August 2021 was Rs.0.77 billion.
In money markets, the increase in the SRR with effect from yesterday saw the overnight net liquidity shortage in the system increasing to a mammoth volume of Rs.205.61 billion yesterday, the highest level seen since January 2004. An amount of Rs.72.37 was deposited at Central Banks SDFR (Standard Deposit facility Rate) of 5.00% against an amount of Rs.277.98 billion been withdrawn from Central Banks SLFR (Standard Lending facility Rate) of 6.00%. The weighted average rates on overnight call money and repo increased marginally to 5.88% and 5.80% respectively while the Domestic Operations Department (DOD) of the Central Bank of Sri Lanka refrained from conducting any auctions for a second consecutive day.
USD/LKR
In Forex markets, the overall market continued to remain inactive yesterday.
The total USD/LKR traded volume for 31st August 2021 was US $ 10.00 million.
(References: Central Bank of Sri Lanka, Bloomberg E-Bond trading platform, Money broking companies)