Foreign ownership of Sri Lankan treasury bills and bonds has climbed steadily over the past seven weeks, rising a further 3.30% in the latest week
Foreign holdings of Sri Lankan government securities have continued a sustained upward trajectory, rising a further 3.30% week-on-week to reach LKR 182.39 billion.
The increase extends a steady climb that has been building over the past seven weeks. Foreign holdings stood at LKR 121.34 billion in mid-June and have risen in nearly every subsequent week, reaching LKR 135.86 billion by late June, LKR 168.90 billion in early July, and now LKR 182.39 billion at the end of July — an increase of roughly 50% over the period.
The rise in foreign holdings comes against a backdrop of a still-elevated but broadly stable overall government securities market, with total outstanding stock at LKR 18.62 trillion, marginally down 0.08% week-on-week. Treasury bonds continue to make up the overwhelming majority of outstanding stock at LKR 16.25 trillion, with treasury bills accounting for the remainder at LKR 2.37 trillion.
The steady build-up in foreign positioning in government securities stands in contrast to the more volatile, single-day-driven foreign flow patterns seen in the equity market over the same period, where net flows have swung between inflows and outflows on a daily basis.
Key Numbers
| Week Ending | Foreign Holdings (LKR Mn) |
|---|---|
| 11-Jun | 121,344 |
| 18-Jun | 121,346 |
| 25-Jun | 135,858 |
| 2-Jul | 136,859 |
| 9-Jul | 168,895 |
| 16-Jul | 176,561 |
| 23-Jul | 182,386 |
| Metric | Value |
|---|---|
| Latest Foreign Holdings | LKR 182.39 billion |
| Week-on-Week Change | +3.30% |
| Total Outstanding GSec Stock | LKR 18.62 trillion |
| Week-on-Week Change (Total Stock) | -0.08% |
| T-Bonds Outstanding | LKR 16.25 trillion |
| T-Bills Outstanding | LKR 2.37 trillion |
Business Impact
A sustained, multi-week rise in foreign holdings of government securities is a more durable signal of foreign investor confidence than any single day’s flow figure, and stands in useful contrast to the more concentrated and volatile foreign activity seen in equities over the same period. For policymakers and treasury market participants, steady foreign appetite for government debt can support demand at future auctions and may have a bearing on funding costs across the yield curve. For businesses and investors more broadly, the trend offers a signal worth tracking alongside — rather than in isolation from — the equity market’s foreign flow patterns, since the two markets are currently telling somewhat different stories about foreign investor positioning in Sri Lanka.
Source Attribution
Source: Central Bank of Sri Lanka statistics and publicly available market information.