Secondary Bond market yields close up

Rs. 43 b T-Bill auction fully subscribed; rates remain broadly steady for 11 straight weeks

- BY WEALTH TRUST SECURITIES

THE secondary Bond market opened last week on a quiet footing, with last Monday marked by subdued activity and thin transaction volumes. Yields held broadly steady as participants largely remained on the side lines ahead of the September CCPI release.

On Tuesday, conditions remained lacklustre for a second consecutive day, though yields edged up marginally. The release of September CCPI, which recorded a positive +1.5% year-on-year (Base 2021=100) compared with +1.2% in August, marked the second consecutive month of positive inflation after nearly a year of deflationary readings. The annual average stood at -1.4%. Despite the data, market sentiment remained cautious, with participants continuing to adopt a wait-and-see approach.

Midweek, yields climbed further, influenced by global developments. News of the US Government shutdown and the Asian Development Bank's downward revision of Sri Lanka's 2026 GDP growth forecast to 3.3% weighed on sentiment. However, renewed buying interest at higher yield levels provided some support, curtailing further upward movement.