Secondary Bond Market Yields Decline Amid Surging Activity 📈

• Market Sentiment: The secondary bond market experienced a shift as aggressive buying interest drove yields lower across most maturities. Transaction volumes were high, bolstered by significant block deals. • Yield Movements: • 2027 maturity: Dropped from 9.00% to 8.95%. • 2029 maturities: Traded lower in the range of 9.70%–9.50%. • 2032 maturities: Yields softened to the 10.35%–10.30% range. • Upcoming Auction: The Central Bank announced a major Treasury Bond auction for January 12, seeking to raise Rs. 205.00 Bn across four maturities (2030, 2033, 2035, and 2039). • Monetary Liquidity: The system maintained a high net liquidity surplus of Rs. 168.45 Bn. Weighted average rates for call money and repo stood at 7.97% and 7.99% respectively. • Currency Performance: The Sri Lankan Rupee appreciated against the US Dollar, with spot contracts closing at Rs. 309.10/50 compared to the previous day’s Rs. 310.05/15. • Volume: Total secondary market transacted volume reached Rs. 76.86 Bn (as of Jan 7), while USD/LKR traded volume was US$ 68.50 Mn.