Market sees early signs of recovery ahead of key government securities auctions
Sri Lanka’s rupee opened stronger on Tuesday, trading at 299.58/68 against the US dollar in the spot market, slightly firmer than Monday’s close of 299.70/90, according to dealers. The currency’s modest appreciation comes alongside a significant drop in government bond yields, indicating improving market sentiment.
Yields on several benchmark bonds fell sharply. The yield on the bond maturing on 01 July 2028 dropped to 9.15/20 percent from the previous 9.30/40 percent. Similarly, the bond maturing on 15 December 2029 was quoted at 9.70/80 percent, down from 9.90/95 percent. The 15 May 2030 bond saw yields fall to 9.85/10.00 percent from 10.00/08 percent, while the bond maturing on 15 March 2031 declined to 10.05/15 percent from 10.22/30 percent.
Equity markets also opened on a positive note. The All Share Price Index (ASPI) rose by 0.36 percent to 16,555, while the S&P SL20 advanced by 0.64 percent to 4,869, reflecting growing investor optimism.
Meanwhile, the Central Bank of Sri Lanka announced two upcoming debt issuances this week. A Treasury bill auction worth Rs. 162,500 million is scheduled for Wednesday, May 28, followed by a Treasury bond issue of Rs. 200,000 million on Thursday, May 29.