News & market updates

Asian shares slipped as Gulf fighting pushed Brent crude above $90/bbl, stoking inflation fears and increasing the likelihood of earlier Fed rate hikes. Packed tech earnings and AI valuation worries add downside risk to equities while higher yields support fixed income.

Sri Lanka's rupee traded at 336.20/30 per US dollar on Monday (from 336.15/25 on Friday) while government bond yields edged up across maturities, with the 15.12.2029 note quoted around 11.10–11.20%.

Foreign investors bought a net US$23.2mn of Sri Lankan rupee government bonds in the week to July 16, lifting foreign holdings to Rs 176,561mn — the highest since July 27, 2023. The inflow comes amid a 100bp May policy-rate hike and recent rupee stabilization.

KPMG says Sri Lanka's credit rebound faces a major test after the Central Bank raised the policy rate by 100 basis points to 8.75%, a move expected to moderate private-sector credit growth. Lower fuel and vehicle imports, resilient remittances and stronger tax revenue are seen supporting a return to a current-account surplus and fiscal consolidation.

Sri Lanka's rupee closed at 336.15/25 to the US dollar in the spot market on Friday, while selected government bond yields edged slightly higher on several tenors (e.g., 15.09.2027 at 10.35/40%, 15.10.2030 at 11.60/65%).

Asian markets plunged on July 17 as a global technology-led selloff drove Japan and Taiwan down as much as 6% and pushed the Nikkei into correction territory (over 10% below its June 25 high). Market watchers cited rising yields, profit-taking in AI/semiconductor names and unwind of leveraged positions.

Sri Lanka sold Rs12,000 million of treasury bills on tap at average rates of 10.13%, 10.27% and 10.20%, bringing total bills sold this week to Rs132 billion.

Sri Lanka's rupee was quoted at 336.26/30 to the US dollar on Friday, while government bond yields were broadly steady; near-dated and medium-term maturities were quoted around 11.10%–11.85%.

Treasury expects Sri Lanka's sovereign rating to be upgraded from CCC+ to B- by early 2027 amid fiscal consolidation. Officials said talks are underway with three major rating agencies and the government plans to return to markets to raise $1.5bn in 2027-28.

Secondary bond-market yields remained broadly steady with selected maturities trading between 10.53% and 12.10% and healthy transaction volumes. Money-market net liquidity surplus was Rs.143.41bn (SDFR deposits Rs.86.65bn), overnight rates ~8.95–8.98%, and USD/LKR closed at 336.20/336.30 (volume $37.02m).

Sri Lanka sold Rs15,000 million of Treasury bonds on tap at auction-set yields, bringing weekly bond sales to Rs165 billion; yields were 11.57% (2030), 12.04% (2034) and 12.58% (2037).

Sri Lanka rupee closed at 336.25/35 to the US dollar in the spot market. Bond yields were broadly steady with small moves across maturities (e.g., 15.09.2027 at 10.30/40% down from 10.40/50%).

Sri Lanka's rupee was quoted at 336.30/45 to the US dollar in the spot market, and dealers said bond yields were broadly steady, with maturities from 2029–2034 quoted around 11.10%–12.10%.

Weekly Treasury bill auction sold the full Rs.120 billion offered as weighted average yields fell (91-day 10.13%, 182-day 10.27%, 364-day 10.20%). Secondary bond yields edged higher on Middle East tensions; net liquidity surplus was Rs.147.19bn and USD/LKR closed at 336.30/336.40.

Sri Lanka's rupee closed at 336.30/40 to the US dollar (from 336.00/20), while government bond yields edged slightly higher — the 15.09.2027 bond rose to 10.40/50% from 10.35/50%.

Sri Lanka's Treasury bill yields fell at Wednesday's auction and all Rs120 billion offered were sold. The 3-month was down 8bps to 10.13% (Rs55bn sold), the 6-month down 3bps to 10.27% (Rs35bn) and the 12-month down 1bp to 10.20% (Rs30bn).

Sampath Bank (SAMP.N0000) will list Rs10 billion of Basel III-compliant tier-2 green bonds, offering 13.00% and 13.25% coupons for 5- and 7-year maturities; Fitch assigned the issue a final National Long-Term Rating of A(lka). Subscription opens July 17.

Sri Lanka's rupee traded at 336.35/50 to the US dollar on Wednesday, slightly weaker than the prior day's 336.00/20, while government bond yields were largely steady. Rs. 120,000 million of Treasury bills are scheduled for auction on July 15.

Asian stocks rallied after U.S. CPI fell 0.4% in June and annual core inflation eased to 2.6%, cutting rate-hike odds and sending two-year Treasury yields down 11bp to 4.19%. Oil steadied around $85.80/bbl and China's Q2 GDP slowed to 4.3%.

Government set a 2027 primary expenditure ceiling of Rs.5.064 trillion (12.9% of GDP) and projects the budget deficit will narrow to 4.5% of GDP in 2027, targeting a primary surplus of 2.6% of GDP from 2027 onwards.

Commercial Bank will open subscriptions on 16 July for up to Rs.20bn of Basel III-compliant subordinated debentures and Sampath Bank will open on 17 July for up to Rs.10bn of Basel III-compliant Tier-2 green bonds. Commercial Bank offers 5/7/10-year series at 13.00–13.25%; Sampath offers 5- and 7-year series at 13% and 13.25%.

Rs.120 billion Treasury Bill auction scheduled today as secondary bond market activity picked up and yields compressed; money-market rates edged down and USD/LKR closed at 336.30/336.40.

Sri Lanka's rupee closed flat at 336.00/20 to the US dollar while government bond yields rose across maturities (e.g., the 15.09.2027 bond at 10.35–10.50%). Rs.120,000 million in Treasury bills will be auctioned on July 15.

Sri Lanka's Colombo Stock Exchange closed down: ASPI fell 0.50% to 21,424.71 with market turnover of Rs.1.089 billion and banks leading turnover at Rs.221.1 million. Merchant Bank (MBSL) set a rights reference price of Rs.0.30 and its stock closed down 5.31% at Rs.10.70.

The Treasury raised the full Rs.150 billion offered at the first-phase bond auction, with weighted average yields of 11.57% (15.10.2030), 12.04% (15.10.2034) and 12.58% (01.07.2037). Money-market liquidity rose to Rs.152.35 billion and USD/LKR closed near 336.00/336.25.

Global markets fell sharply as Gulf tensions and Iran's claim to have closed the Strait of Hormuz drove Brent crude up 4.3% to $79.31/bbl, lifting bond yields and reviving inflation and interest-rate tightening concerns.

Insurance industry GWP rose 24.54% to Rs.114,863 million in 1Q 2026 from Rs.92,229 million a year earlier. Total assets grew 16.65% to Rs.1,478,777 million and industry PBT edged up 3.14% to Rs.9,978 million, with Life PBT down 11.5% and General PBT up 28.1%.

Sri Lanka rupee quoted at 336.30/50 per US dollar, slightly weaker than 336.00/20 the previous day; bond yields were slightly higher after recent government bond sales. Rs120,000 million Treasury bills auction is scheduled for July 15.

Sri Lanka sold Rs150 billion of government bonds across 2030, 2034 and 2037 maturities, with average yields of 11.57%, 12.04% and 12.58% respectively; all offered amounts were sold and are available on tap.