Aug 28, 2013 (LBO) – Sri Lanka’s Treasuries yields were steady at Wednesday’s auction with 9.7 billion rupees in bills being sold to the market, after offering 10 billion rupees, the state debt office said. A central bank that prints money to buy Treasury bills adds demand to the economy, which trigger imports and causes currency weakness.
If the exchange rate is defended, foreign reserves are lost.
The 3-month bills were sold at 8.61 percent, flat from two weeks ago. The six month yield eased 01 basis point to 9.64 percent and the 12-month yield rose 01 basis point to 10.56 percent.
It is not clear whether the Central Bank bought any of the bills for which bids were not accepted from the market.