📈 Mixed Yields & High Liquidity Ahead of Rs. 100 Bn T-Bill Auction

The secondary bond market remained active with a flattening yield curve as investors balanced profit-taking on short-term tenors against stable demand for medium-to-long-term maturities. • Secondary Bond Market: Rates on the 2029-2030 "belly" of the curve initially dropped (9.71% - 9.80%), while short-term 2027-2028 maturities saw a sell-off, pushing yields up to 8.50% - 9.26% due to profit-taking. Daily transaction volume reached Rs. 14.71 Bn. • T-Bill Auction: The Central Bank has offered Rs. 100 Bn for today's auction (Jan 7), matching maturities of ~Rs. 97.73 Bn. This follows last week’s auction where weighted averages rose across all tenors (91-day: 7.74%, 182-day: 8.27%, 364-day: 8.45%) with a 47.83% subscription rate. • Money Market Liquidity: Net liquidity surplus rose for the fourth day to Rs. 175.21 Bn. Overnight call money and Repo rates stood at 8.00% and 8.03% respectively. • Currency Movement: The LKR saw slight depreciation, with the USD/LKR spot contract closing at Rs. 310.00/10 compared to the previous Rs. 309.95/05. Traded volume for Jan 5 was US$ 68.45 Mn.