COLOMBO – 30 September 2026 – The Central Bank of Sri Lanka (CBSL) today concluded its routine open market operations (OMO), signalling its ongoing commitment to managing liquidity within the domestic money market and influencing short-term interest rates. The operations, conducted by the Market Operations Department, included overnight, short-term, and long-term repo auctions, alongside details on overnight money market transactions and the utilisation of standing facilities.
These daily operations are crucial for ensuring the smooth functioning of the financial system and are closely watched by market participants for insights into the central bank’s monetary policy stance.
Overnight Money Market Activity
The overnight money market saw significant activity, with both the Call Money and Repo Markets reporting substantial gross and net amounts. The key rates for the overnight transactions were as follows:
- Call Money Market: Weighted Average Rate of 8.98%, with rates fluctuating between a minimum of 8.95% and a maximum of 9.00%. Total gross and net amounts reached Rs. 62,681 million.
- Repo Market: A Weighted Average Rate of 9.02% was observed, with rates ranging from a minimum of 8.96% to a maximum of 9.10%. The total gross and net amounts transacted stood at Rs. 108,475 million.
Open Market Operations Overview
The CBSL conducted three distinct repo auctions to absorb or inject liquidity as necessary, offering varying maturities to cater to market needs.
Overnight Repo Auction
The overnight repo auction, settling and maturing on 30 September 2026 and 1 October 2026 respectively, saw the CBSL offer Rs. 60,000 million. Bids received amounted to Rs. 69,750 million, indicating a healthy demand for overnight funds. The CBSL accepted the full offered amount of Rs. 60,000 million at a Weighted Average Yield of 8.73%. Both the minimum and maximum accepted rates also stood at 8.73%.
Short Term Repo Auction
A short-term repo auction with a 7-day maturity (settling 30 September 2026, maturing 7 October 2026) was also conducted. The CBSL offered Rs. 40,000 million. Bids received totalled Rs. 35,000 million, which was fully accepted. The Weighted Average Yield for this auction was 8.75%, with the minimum and maximum accepted rates also aligning at 8.75%.
Long Term Repo Auction
For longer-term liquidity management, a 29-day long-term repo auction was held (settling 1 October 2026, maturing 30 October 2026). The CBSL offered Rs. 20,000 million, attracting strong interest with bids totalling Rs. 41,000 million. From the received bids, the CBSL accepted the full offered amount of Rs. 20,000 million. The Weighted Average Yield for the long-term repo was 9.14%, with accepted rates ranging from a minimum of 9.13% to a maximum of 9.15%.
Standing Facility Utilisation
Financial institutions also utilised the CBSL’s Standing Facilities, reflecting the prevailing liquidity conditions in the market. The Standing Deposit Facility (SDF) saw an uptake of Rs. 78,262 million, indicating surplus liquidity parked with the central bank. Conversely, the Standing Lending Facility (SLF) was accessed for Rs. 14,600 million, suggesting some institutions required short-term liquidity injections.
CBSL Treasury Bill/Bonds Holdings
As part of its balance sheet, the Central Bank of Sri Lanka reported its holdings of Treasury Bills and Bonds. The Face Value of these holdings stood at Rs. 2,492,619.35 million, with a corresponding Book Value of Rs. 1,526,539.93 million.
These operations highlight the Central Bank’s proactive approach in maintaining stability and efficiency in Sri Lanka’s financial markets through precise liquidity management tools.
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