Sri Lanka 3-month treasuries move up to 17.80%, rupee weaker

Sept 5, 2007 (LBO) – Sri Lanka’s 3-month Treasury bill yields moved up 15 basis points to 17.80 percent rolling over 9.3 billion rupees of debt on Wednesday’s auction, the government’s debt office said. The cut-off for the 3-month bill had moved to 17.95 percent, dealers said.

The 6-month yield moved up 16 basis points to 17.16 percent and 12-month yields moved 17 basis points to 16.89 percent, pushing the weighted average yield 13 basis points to 17.71 percent.

The government retired 2.7 billion worth of bills.

In the secondary market, government bonds maturing in April 2012 traded at 17.05 before the auction results were known.

The rupee edged lower to a new low of 113.25 against the greenback with a state name and a foreign name buying, but eased up to 113.10/20 in late trading.

Six months forwards were somewhat active at 121.10 levels indicating a premium of 7.80/90 on interest differentials with the 6-months US dollar LIBOR of around 5.6 percent and the Sri Lank rate pitched at around 19.7 percent, dealers said.

However, exporters were not yet booking forward, dealers said.

Call markets were quiet with rates peaking at 16 percent and moving down to 14 percent amid excess liquidity, which was drained by the Central Bank at 11.25 percent though a repo auction.

Equity markets closed flat with the all share moving up 2.8 points (0.11 percent) while the liquid Milanka moved down 6.24 points (0.18 percent).

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