Sri Lanka Treasuries yields sharply up

Nov 23, 2011 (LBO) – Sri Lanka’s Treasuries yields rose steeply across maturities at Wednesday’s auction with average one year yield touching 8.50 percent, data from the state debt office showed. Following the auction there were quotes for a bond maturing in 2015 at around 10.25/11.00 percent, dealers said.

Update The 3-month yield rose 44 basis points to 7.95 percent and the 6-month yield rose 64 basis points to 8.18 percent.

The 12-month yield rose 91 basis points to 8.50 percent from two weeks earlier. Last week the debt office, which is a unit of the Central Bank rejected all offers.

The debt office said 3.0 billion rupees in 3-month bills were sold, 2.0 billion rupees in 6-month bills were sold and 3.0 billion in 12-month bills were sold.

Earlier in the day 3-month gilt repos traded around 8.50 percent dealers said.

There is uncertainty in Sri Lanka’s bond markets following a devaluation announcement in the budget and liquidity has dried up with and no quotes for several maturities.