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Bond Yields Decline With Lower Borrowing Costs

Bond Yields Decline With Lower Borrowing Costs: Inside Sri Lanka

2019-01-24 02:58:30.589 GMT

By Anusha Ondaatjie

(Bloomberg) — Sri Lanka’s bond yields fell as the government’s cost of borrowing was mostly lower at an auction Wednesday.

* Central bank sold 21b rupees ($115m) of 364-day bills at 10.70%, down from 10.75% at previous auction, and 2.55b of 182- day notes at 9.87%, unchanged from the last sale

* “There is buying interest coming in at the short end, especially with bills down,” says Dimantha Mathew, head of research at First Capital in Colombo

** “Some foreign inflows into two-year bonds also boosted sentiment and helped shift money from the mid to longer tenors.”

* Yield on 11.5% govt bonds due December 2021 fell 4bps to 10.78% on Wednesday

* Global funds bought a net $0.1m of Sri Lankan shares on Wednesday, helping pare the month’s outflows to $13m: exchange data

* USD/LKR marginally changed t 182.20