Sri Lanka Treasury bill yields decline as Rupee fluctuates

Sri Lanka’s Treasury bill yields saw a modest decline across all three tenors in the latest auction. The 91-day and 182-day bills both eased by 16 basis points to 9.06%, while the 364-day bill decreased by 2 basis points to 9.89%. Demand for the auction was robust, with bids exceeding the LKR 120,000 million offered. This downward trend in short-term borrowing costs coincides with a 4% week-on-week increase in foreign holdings of government securities.

In the foreign exchange market, the Sri Lankan Rupee showed slight depreciation against the US Dollar at several commercial banks. While the US Dollar selling rate remained steady at approximately Rs. 332 at major institutions like Seylan Bank, Commercial Bank, and Sampath Bank, some banks reported minor increases in both buying and selling rates. For instance, People’s Bank reported a slight rise in the buying rate to Rs. 324.11 and the selling rate to Rs. 332.14.