📈 T-Bill Rates Rise at Slower Pace; Rupee Appreciates on New FX Rules

• Treasury Bill Auction: Yields rose for the 4th consecutive week, hitting their highest levels since late-September 2024, though the upward pace moderated. The 6-month rate notably surpassed the 1-year rate. • Yield Breakdown: - 91-day: Up 25 bps to 10.09% - 182-day: Up 26 bps to 10.27% - 364-day: Up 14 bps to 10.16% • Auction Subscription: The auction raised Rs. 71.74 Bn out of Rs. 140 Bn offered in the first phase (51.25% subscription rate), with the bulk raised from shorter 3-month tenors. Cumulative yield increases (167–202 bps) have significantly outpaced the recent 100 bps policy rate hike. • Secondary Bond Market: Rates held steady ahead of today's Rs. 150 Bn Treasury Bond auction. Trading volumes remained subdued due to geopolitical uncertainty and volatile crude oil prices. • Forex & Liquidity: The Sri Lankan Rupee appreciated sharply to Rs. 332.25/333 per USD (from Rs. 337/337.75) after the CBSL reduced the exporter FX conversion window to 30 days to bolster national reserves. Market liquidity recorded a net surplus of Rs. 57.38 Bn.