Sri Lanka Treasury rates steady; volumes low

Mar 26, 2008 (LBO) – Sri Lanka’s Treasury bill rates moved up by 1 to 3 basis points across maturities at an auction Wednesday, the government debt office said, after rolling over only 6.2 billion rupees out of 10 billion rupees worth maturing bills. The 3-month average yield was up 3 basis points to 18.39 percent with 4.2 billion rupees of bills sold, the 6-month yield was up 1 basis point to 18.96 with 1.2 billion in bills sold and the 12-month yield was also up 1 basis point to 19.00 percent with only 762 million sold.

The debt office, which is part of Sri Lanka’s central bank, was in the market offering 6 and 12 month bills at average rates after the auction, dealers said.

However, the market was short of liquidity over the week, with analysts speculating that a large dollar payment had gone out of the country and overnight short term rates touched 20 percent.

Earlier in the day a state name was offering to buy bills at 18.5 percent, when market players had bid at higher rates amid tight liquidity, dealers said.

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