📈 Bond Yields Mixed; Focus Shifts to Rs. 70 Bn T-Bill Auction

• Market Sentiment: The secondary bond market experienced mixed trends, with short-term yields edging marginally lower and medium-term yields ticking slightly upward. Activity was influenced by falling global Brent crude prices following a US 60-day license for Iranian oil and reports of unfreezing $ 12 billion in Iranian assets. Overall trading volume remained moderate. • Bond Yield Movements: • 01.05.28 & 15.10.28: Traded at 10.64%-10.60% and 10.655%-10.635% respectively. • 15.12.29: Traded at 10.90%. • 01.08.30: Downward movement to 11.20%-11.17%. • 01.11.33: Traded at 11.65%. • 15.06.34 & 15.06.35: Traded at 11.70% and 11.95%. • Treasury Bill Auction: A total of Rs. 70.00 Bn is on offer today (91-day: Rs. 35 Bn, 182-day: Rs. 25 Bn, 364-day: Rs. 10 Bn). At the previous week's auction, yields dropped for the first time in five weeks (91-day down 7 bps to 10.02%; 182-day down 11 bps to 10.16%; 364-day flat at 10.16%), correcting the T-Bill yield curve inversion. • Liquidity & Money Market: Interbank call money and repo rates averaged 9.21% and 9.24%. The net market liquidity surplus stood at Rs. 64.26 Bn, with Rs. 101.11 Bn deposited at the Central Bank's SDFR (8.25%) and Rs. 36.85 Bn utilized via the SLFR (9.25%). • Forex Market: The Sri Lankan Rupee dipped marginally against the US Dollar, closing at Rs. 335.00/335.50 on spot contracts compared to the previous close of Rs. 334.45/334.75. The total traded USD/LKR volume was US$ 57.25 Mn.