COLOMBO, Sri Lanka – 02 October 2026 – The Central Bank of Sri Lanka (CBSL) today released its Open Market Operations (OMO) report for October 2, 2026, providing a detailed snapshot of the country’s money market liquidity and the CBSL’s interventions. These operations are crucial for managing short-term liquidity, influencing interbank interest rates, and ensuring the stability of Sri Lanka’s financial system.
According to the official data from the Market Operations Department, the CBSL engaged in a series of repo auctions and facilitated transactions in the overnight money market, alongside its standing facilities and updates on its Treasury bill and bond holdings.
Overnight Money Market Dynamics
On October 2, 2026, the overnight money market saw significant activity. The Call Money Market recorded a weighted average rate of 8.99%, with rates ranging from a minimum of 8.95% to a maximum of 9.02%. The total gross and net amounts transacted stood at Rs. 23,720 million.
The Repo Market, a key component of interbank lending, registered a weighted average rate of 9.04%. Rates in this segment varied between 9.00% and 9.07%. The total gross amount in the Repo Market reached Rs. 112,650 million, while the net amount was Rs. 112,150 million, indicating robust activity in short-term secured lending.
Central Bank’s Open Market Operations
The CBSL conducted three distinct repo auctions to manage liquidity, offering varied maturities and absorbing funds from the market.
i. Overnight Repo Auction
- Amount Offered: Rs. 80,000 million
- Auction Date: 2 October 2026
- Settlement Date: 2 October 2026
- Maturity Date: 5 October 2026
- Bids Received: Rs. 48,000 million
- Amount Accepted: Rs. 48,000 million
- Weighted Average Yield: 8.74%
- Minimum Accepted Rate: 8.72%
- Maximum Accepted Rate: 8.75%
This auction saw all received bids accepted, indicating the CBSL’s intention to absorb a moderate portion of the overnight liquidity.
ii. Short Term Repo Auction
- Amount Offered: Rs. 50,000 million
- Auction Date: 2 October 2026
- Settlement Date: 2 October 2026
- Maturity Date: 9 October 2026 (7 Days)
- Bids Received: Rs. 22,000 million
- Amount Accepted: Rs. 22,000 million
- Weighted Average Yield: 8.75%
- Minimum Accepted Rate: 8.75%
- Maximum Accepted Rate: 8.75%
The short-term auction was undersubscribed, with the CBSL accepting all Rs. 22,000 million bid at a uniform yield, reflecting specific market demand for this tenor.
iii. Long Term Repo Auction
- Amount Offered: Rs. 20,000 million
- Auction Date: 2 October 2026
- Settlement Date: 5 October 2026
- Maturity Date: 5 November 2026 (31 Days)
- Bids Received: Rs. 21,000 million
- Amount Accepted: Rs. 20,000 million
- Weighted Average Yield: 9.14%
- Minimum Accepted Rate: 9.14%
- Maximum Accepted Rate: 9.14%
The long-term auction was slightly oversubscribed, with the CBSL accepting the full offered amount of Rs. 20,000 million, indicating healthy demand for longer-dated repo facilities at a consistent yield.
Use of CBSL Standing Facilities
Market participants utilized the CBSL’s Standing Deposit Facility (SDF) to deposit excess liquidity. On October 2, 2026, the total amount placed under the SDF was Rs. 105,105 million. There was no recorded usage of the Standing Lending Facility (SLF), suggesting sufficient liquidity within the banking system to meet short-term funding needs without recourse to the higher-cost lending facility.
CBSL Treasury Bill/Bonds Holdings
The CBSL’s holdings of Treasury Bills and Bonds stood at a face value of Rs. 2,492,619.35 million. The corresponding book value was Rs. 1,525,341.96 million. These holdings reflect the CBSL’s balance sheet and its operations in the government securities market, impacting overall liquidity and long-term interest rate trends.
The detailed results of these operations provide valuable insights into the prevailing liquidity conditions in the Sri Lankan money market and the proactive stance of the Central Bank in maintaining financial stability.
Source: Read original document
