Secondary Bond market opens on a strong footing; yields continue to decline as rally continues

Rs. 57 b T-Bill auction in focus; offered amount less than maturity amount for 2nd straight week ■Rupee depreciates marginally

- BY WEALTH TRUST SECURITIES

THE secondary Bond market yesterday kicked off the new trading week on a positive note carrying over the bullish momentum from last week's rally.

The market sentiment was supported by news that the foreign holdings of Sri Lankan rupee Government securities rose by Rs. 10.36 billion during the previous week - ending 30 October. This marked the largest inflow in 32 weeks and the fourth consecutive gain.

As a result, total holdings reached Rs. 141.32 billion, the highest in two years, reflecting a 259% surge from September 2024 lows. The market extended the rally and saw strong buying interest push yields lower.

Activity and transaction volumes were seen at robust levels. The demand was concentrated on 2026-2030 tenors, which saw the bulk of the action and the decline in rates. In conclusion, secondary market two-way quotes were seen closing lower, resulting in a further downward shift of the yield curve.