WAYs fall 3rd week

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Weighted average yields (WAYs) at yesterday’s  weekly Rs 87.5 billion Treasury (T) Bill auction fell across the board for the  third consecutive market  week, aided by a guided auction, coupled with sustained uncertainty, where, investors continued to prefer to invest in riskless, but “low” returns T Bills, rather than the lucrative private sector, the engine of growth.

Subsequently, at  yesterday’s  auction, the WAYs of the 91, 182 and the benchmark 364 day maturities declined by 114, 27 and  34 basis points (bps) each to 27.72, 28.97 and 29.19 per cent respectively, week on week.

The sales splits at yesterday’s   auction comprised 178.44 per cent (Rs 62,453 million) of the 91-day maturity compared to its original offer of Rs 35,000 million made to the market; 36.50 per cent (Rs 10,037 million) of the 182-day maturity compared to its original offer of Rs 27,500 million and 60.40 per cent (Rs 15,010 million) of the 364-day maturity compared to its original offer of Rs 25,000 million, respectively. Subsequently, Central Bank of Sri Lanka (CBSL) the steward of Government of Sri Lanka (GoSL) debt sold the total parcel of Rs 87.5 billion offered across the board to the market at yesterday’s auction. CBSL on behalf of the GoSL will have to repay maturing T Bills of Rs 74,352 million in value to the market by tomorrow.

Their splits are Rs 74,069 million worth of maturing 91 day T Bills and Rs 2,413 million worth of maturing 364 day T Bills, respectively. There are however no maturing 182-day worth of T Bills up for repayment by tomorrow.

Maturing T Bills held by CBSL and which are also due for repayment by tomorrow are however unknown as CBSL, the steward of GoSL debt, doesn’t make privy such information.

By Paneetha  Ameresekere