Colombo, 08 September 2026 – The Central Bank of Sri Lanka (CBSL) today released its customary update on Open Market Operations (OMO) conducted on September 8, 2026. These daily operations are a vital tool for the CBSL’s Market Operations Department in managing liquidity within the domestic financial system and influencing short-term interest rates.
Overnight Money Market Dynamics
The overnight money market saw active participation, with rates reflecting current liquidity conditions. The Call Money Market recorded a weighted average rate of 8.87%, with transactions spanning a minimum of 8.80% and a maximum of 8.92%. The total gross amount transacted reached Rs. 47,925 million, with an identical net amount.
In the Overnight Repo Market, the weighted average rate settled at 8.95%, experiencing a range between 8.90% and 9.00%. This segment generated a total gross amount of Rs. 55,273 million, with a net amount of Rs. 55,217 million. These figures provide a snapshot of the interbank borrowing and lending activities.
CBSL’s Open Market Auctions
To further calibrate market liquidity, the CBSL conducted two significant repo auctions on the day:
Overnight Repo Auction
The Central Bank offered an overnight repo facility to financial institutions:
- Amount Offered: Rs. 40,000 million
- Bids Received: Rs. 41,500 million
- Amount Accepted: Rs. 40,000 million
- Weighted Average Yield: 8.74%
- Minimum Accepted Rate: 8.73%
- Maximum Accepted Rate: 8.75%
The robust demand, exceeding the offered amount, underscores the market’s need for short-term liquidity, with the CBSL accepting the full offered sum at a finely tuned weighted average yield.
Short Term Repo Auction (7-Day Maturity)
A short-term repo auction with a 7-day maturity was also part of today’s operations:
- Amount Offered: Rs. 30,000 million
- Bids Received: Rs. 15,000 million
- Amount Accepted: Rs. 15,000 million
- Weighted Average Yield: 8.75%
- Minimum Accepted Rate: 8.75%
- Maximum Accepted Rate: 8.75%
In this instance, bids received were less than the amount offered, with the CBSL accepting all bids at a consistent yield across the board. This suggests a more moderate demand for liquidity extending over the 7-day period compared to the overnight segment.
Use of Standing Facilities and Treasury Holdings
Further insights into the financial system’s liquidity position can be drawn from the utilization of the CBSL’s standing facilities:
- Standing Deposit Facility (SDF): Rs. 65,167 million
- Standing Lending Facility (SLF): Rs. 364 million
The substantial amount placed under the Standing Deposit Facility indicates that banks held excess funds which they deposited with the CBSL. Conversely, the minimal use of the Standing Lending Facility suggests that financial institutions generally managed their liquidity effectively without significant recourse to emergency borrowing from the central bank.
As of September 8, 2026, the Central Bank of Sri Lanka’s Treasury Bill and Bond holdings stood at a face value of Rs. 2,492,619.35 million and a book value of Rs. 1,556,761.31 million. These holdings are a key component of the central bank’s balance sheet and its capacity to conduct future market operations.
Conclusion
Today’s Open Market Operations reflect the Central Bank of Sri Lanka’s continued diligence in managing money market liquidity. Through a combination of repo auctions and the provision of standing facilities, the CBSL actively intervenes to ensure price stability and the smooth functioning of the nation’s financial system.
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