📈 Primary Bond Auctions See Positive Rates Amid Undersubscription

The Treasury Bond auctions conducted yesterday yielded weighted average rates below or in-line with secondary market levels, signaling a stable interest rate environment despite moderate participation. • Auction Performance: The government raised Rs. 87.02 billion, reflecting a 66.94% acceptance rate of the Rs. 130 billion on offer. The bid-to-acceptance ratio stood at 2.45 times. • Maturity Breakdown: - 01.03.30: Issued at 9.63% (Undersubscribed). - 15.06.34: Issued at 10.70% (Undersubscribed). - 15.08.36: Issued at 10.80% (Fully subscribed at 1st phase). • Secondary Market: Activity remained subdued as yields consolidated. Traders adopted a conservative stance due to global headwinds from the US-Iran conflict. Notable trades included the 15.09.27 maturity at 8.55% and the 01.11.33 at 10.50%. • Liquidity & Forex: - Market Liquidity: Net surplus recorded at Rs. 319.48 billion. The Central Bank drained Rs. 150 billion via overnight repo at 7.44%. - Currency: The USD/LKR spot exchange rate closed slightly weaker at Rs. 311.00/311.15, compared to the previous close of Rs. 310.85/310.95. - Trade Volume: Total USD/LKR volume for March 10 stood at $ 56.50 million.