COLOMBO, Sri Lanka – 25 August 2026 – The Central Bank of Sri Lanka (CBSL) today released its customary update on Open Market Operations (OMO) conducted by its Market Operations Department, offering a comprehensive look into the domestic money market’s liquidity and short-term interest rate environment as of August 25, 2026.
The report details transactions in the overnight money market, various repo auctions, the utilisation of standing facilities, and the CBSL’s holdings of Treasury Bills and Bonds, providing crucial insights for financial market participants and economic observers alike.
Overnight Money Market Dynamics
On August 25, 2026, the overnight money market saw active participation. The Call Money Market recorded a weighted average rate of 8.84%, with rates fluctuating between a minimum of 8.72% and a maximum of 8.86%. The total gross amount transacted stood at Rs. 34,325 million, with an equivalent net amount.
Meanwhile, the Repo Market reported a slightly higher weighted average rate of 8.88%, ranging from 8.82% to 8.92%. Gross transactions in this segment amounted to Rs. 89,258 million, while the total net amount settled was Rs. 89,000 million.
Central Bank’s Open Market Operations
The CBSL conducted several repo auctions to manage liquidity within the financial system:
Overnight Repo Auction
The overnight repo auction, maturing on August 28, 2026, saw the CBSL offer Rs. 40,000 million to the market. Bids received significantly exceeded the offered amount, totalling Rs. 58,000 million. The CBSL accepted the full offered amount of Rs. 40,000 million at a weighted average yield of 8.74%. The accepted rates ranged from 8.74% to 8.75%.
Short-Term Repo Auction
A 7-day Short Term Repo Auction, settling and maturing on September 1, 2026, was also conducted. While the CBSL offered Rs. 40,000 million, the bids received were Rs. 25,000 million. The entire bid amount of Rs. 25,000 million was accepted at a uniform weighted average yield of 8.75%, indicating a precise market demand for this specific tenor.
Long-Term Repo Auction
For longer-term liquidity management, the CBSL held a 28-day Long Term Repo Auction, settling on August 28, 2026, and maturing on September 25, 2026. An amount of Rs. 60,000 million was offered, attracting bids worth Rs. 88,000 million. The CBSL accepted the full offered amount of Rs. 60,000 million. This auction registered a weighted average yield of 9.18%, with accepted rates spanning from 9.15% to 9.21%, reflecting the market’s expectation for longer-term rates.
Standing Facilities and Treasury Holdings
The utilisation of the CBSL’s Standing Facilities provides further insight into the banking system’s liquidity position. On August 25, 2026, commercial banks placed Rs. 117,872 million in the Standing Deposit Facility (SDF). Notably, there was no utilisation of the Standing Lending Facility (SLF), suggesting ample liquidity within the system and no immediate need for emergency overnight funding from the central bank.
The report also updated the CBSL’s holdings of Treasury Bills and Bonds. The face value of these holdings stood at Rs. 2,492,619.35 million, while the book value was recorded at Rs. 1,524,244.39 million.
These figures from the CBSL’s Open Market Operations underscore the central bank’s ongoing efforts to manage liquidity effectively, guide short-term interest rates, and maintain stability within Sri Lanka’s financial system.
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