Sri Lanka sold a further 14 billion rupees of Treasury bills offered on tap, taking the total raised through bill sales for the week to 154 billion rupees, the Public Debt Management Office said.
The tap sale cleared at average rates of 9.22 percent, 9.60 percent and 9.91 percent across the three tenors, EconomyNext reported.
The additional sale followed Wednesday’s scheduled auction, at which the debt office raised 140 billion rupees across 3-month, 6-month and 12-month bills. All three maturities were subsequently offered on tap — the mechanism that lets the debt office place more paper at the rates set by the auction, once the auction itself has closed.
Borrowing costs continue to ease
The rates are materially below where the same maturities were trading a month ago. At the auction in late July, the 3-month bill was accepted at 9.86 percent, the 6-month at 10.21 percent and the 12-month at 10.20 percent.
The two sets of numbers are not a strict like-for-like comparison — the July figures are auction yields and Thursday’s are the average rates on a tap sale — but the direction is consistent, and all three tenors have moved lower. Yields on 6-month and 12-month paper have dropped below 10 percent over the period.
Treasury bill rates are a standard gauge of what it costs the government to fund itself at the short end, and of how much liquidity is sitting in the banking system. Falling yields alongside a fully placed auction and a follow-on tap sale point to demand comfortably ahead of the amounts being offered.
The government has leaned on short-dated domestic borrowing through the year while managing its external repayment schedule, and has repeatedly filled its full offering at these auctions.
