Secondary market yield rates of T-Bills show marginal increase, Treasury Bonds slightly decrease

On year-on-year basis, National Consumer Price Index (NCPI) based headline inflation decreased to 2.1 per cent in August 2023 from 4.6 per cent in July 2023. The Food inflation recorded at -5.4 per cent while the Non-Food inflation recorded at 9.0 cent in August 2023. Furthermore, the NCPI based core inflation decreased to 4.1 per cent in August 2023 from 6.3 per cent in July 2023.

During the week, the secondary market yield rates of T-Bill portrayed marginal increase while the primary market yields rates remaining broadly stable. In the meantime, the secondary market yield rates of Treasury Bonds slightly decreased during the week compared to the week before. During the period under review (16.09.2023 to 22.09.2023), crude oil prices showed a mixed performance. Prices increased mainly owing to expectations of a supply deficit stemming from extended output cuts by Saudi Arabia and Russia.

However, prices fell later due to global demand uncertainties and US Fed’s warnings of higher rates for an extended period. Overall, Brent and WTI prices decreased by US dollars 0.51 per barrel and US dollars 1.02 per barrel, respectively, during the review period.The outstanding stock of T-Bills and T-Bonds held by foreigners has decreased by 1.9 per cent in rupee terms during the reporting week compared to the week before.

The weekly T-Bill auction was oversubscribed by 1.5 times during the reporting week.The total volume of secondary market transactions in T-Bills and T-Bonds has increased by 17.62 per cent in the reporting week compared to the week before

During the year up to 22nd September 2023, the Sri Lanka rupee appreciated against the US dollar by 11.9 per cent. Given the cross currency exchange rate movements, the Sri Lanka rupee appreciated against the Japanese yen by 24.6 per cent, the pound sterling by 9.7 per cent, the Euro by 11.9 per cent and the Indian rupee by 11.9 per cent during this period. -Central Bank