Tuesday 8 September 2015

Sri Lanka bond yields up 30 - 129bp at auction

ECONOMYNEXT - Sri Lanka sold 15.6 billion rupees of 5, 8 and 15 year bonds at Tuesday's auction with the 15-year bonds up 129 basis points from the last auction on May 28, data from the state debt office showed.

The debt office sold 3.7 billion rupees of 5-year bonds maturing on 01.05.2020 at an average yield of 9.65 percent up 30 basis points from the last auction of August 31.

The yield on 8-year bonds maturing on 01.09.2023 rose 49 basis points to 9.76 percent from the last auction on August 25 with 4.47 billion rupees raised.

The debt office sold 7.42 billion rupees of 15-year bonds maturing on 15.05.2030 at 10.96 percent, up 129 basis points from the last auction on May 28. On August 25 bids were rejected for similar maturities.

The debt office rejected bid for 11 year bond maturing on 01.06.2026.

Sri Lanka's bond yields started to rise after domestic excess liquidity ran out with high demand being triggered by state domestic borrowing and spending generating foreing reserve losses. Over the last three months the Central Bank also printed over 100 billion rupees to keep short-term interest rate down and trigger a balance of payments crisis.

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