MONETABRIEF – Sri Lanka rupee closed at 332.20/30 to the US dollar in the spot market Monday, marginally down from 332.15/25 to the US dollar on Friday, while bond yields were flat.
When there are high levels of excess liquidity in money markets turn into credit, there is a daily mis-match between inflowing and outflowing dollars, leading to pressure on the exchange and inability to collect reserves.
The key tool of the Sri Lanka's IMF program, which restrained the inflation bias of the central bank, in the form of a requirement sell its domestic assets outright ended at the beginning of 2025, leading to reduced ability to collect reserves.
There have been calls to allow the Treasury to buy dollars to that inflation biased macro-economists cannot inflate the monetary base by monetizing the balance of payments.
A bond maturing on 15 October 2028 closed at 11.00/10 percent on Monday, unchanged from Friday’s close of 11.00/10 percent.
A bond maturing on 15 September 2029 closed at 11.10/20 percent, unchanged from 11.10/20 percent.
A bond maturing on 15 October 2030 closed at 11.50/60 percent, down from 11.55/65 percent.
A bond maturing on 1 December 2031 closed at 11.80/90 percent, down from 11.85/95 percent.
A bond maturing on 15 December 2032 closed at 11.95/12.05 percent, down from 12.00/10 percent.
A bond maturing on 1 November 2033 closed at 12.30/40 percent, up from 12.25/35 percent.
A bond maturing on 15 October 2034 closed at 12.40/50 percent, unchanged from 12.40/50 percent.
A bond maturing on 15 June 2035 closed at 12.50/60 percent, up from 12.50/55 percent.
A bond maturing on 15 August 2036 closed at 12.30/65 percent, unchanged from 12.30/65 percent.
A bond maturing on 1 July 2037 closed at 12.30/65 percent, unchanged from 12.30/65 percent.
A bond maturing on 15 August 2039 closed at 12.30/75 percent, unchanged from 12.30/75 percent.
Three-month bills closed at 9.20/30 percent Monday, unchanged from Friday’s close of 9.20/30 percent.
Six-month bills closed at 9.45/55 percent, unchanged from 9.45/55 percent.
Twelve-month bills closed at 9.90/10.10 percent, unchanged from 9.90/10.10 percent. (Colombo/Oct27/2026)