Largest T Bill Auction Fully Subscribed

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The market, yesterday, led by sustained uncertainty, fully subscribed the Rs 98,000 million weekly Treasury (T) Bill auction of date, its largest ever, preferring to invest, in riskless, low returns T Bills, rather than invest in the high returns private sector, the engine of growth.

Consequently weighted average yields (WAYs) across the board fell for the third consecutive market week to yesterday, with the WAYs declining 84, 71 and 62 basis points (bps) each to 21.91, 22.89 and 23.13 per cent, in respect of the 91, 182 and the benchmark 364 day maturities, respectively.

In this connection, Central Bank of Sri Lanka, the steward of Government of Sri Lanka debt, oversaw the subscription of 138.66 per cent (Rs 55,426 million), 42.97 per cent (Rs 12,891 million) and 105.88 per cent (Rs 29,647 million) compared to the original parcels of Rs 40,000 million; Rs 30,000 million and Rs 28,000 million offered, in respect of the 91, 182 and 364 day maturities at yesterday’s auction.

BY Paneetha Ameresekere