Updated on Jan 03, 2000
The money market remained well above the double digit mark contrary to
the year end scenario in 1998. Overnight rates had closed at 3.00% to 4.00% on Dec 31st
last year, but this time the market remained at 13.00% throughout the day on Dec 30th with
some overnight repos also being reported at slightly higher levels as well Infact banks
also covered themselves over the year end for one week at 13.00%. However amounts traded
for one week were moderate. The market closed short with reports of a heavy discounting
figure of an estimated Rs. 8.0 bln to Rs. 10.0 bln. SBP injection of Rs. 4.40 billion
through its Special OMO and a previous OMO maturity of Rs. 3.50 billion also failed to
keep banks from approaching SBP for respite. The term market did see significant activity
with concentration in forward deals from the month of January. One month trades were hard
to come by with lenders refraining to cross the year end and also due to the month of
January registering a net outflow in excess of Rs. 10 billion. Bids did touch a high of
11.50% in repo but trades were hard to come by due to lack of offers. Three month trades
were traded from forward dates of 15th Jan. and 20th Jan in between 8.90% and 9.20% while
six month trades were also reported around 9.50%, from similar dates. SBP refrained from
heightening the cut-off in the latest auction settlement on the 30th of December by
keeping the one year T-Bill cut-off level relatively stable at 10.3061% and accepted a
meager amount of Rs. 222.505 million.
The much awaited news pertaining to an imminent cut in interest rates
was finally driven home with a reduction in rates available in National Savings Schemes
applicable before the turn of the century. It now seems that clear signals are present for
another downward reduction in T-Bill cut-offs. Even a short market on year end did not
refrain some banks from participating in the outright sale of T-Bills in the OMO on the
30th of Dec. and heavy participation in the auctions in January still cannot be ruled out.
However, with the money market still short, coupled with January already registering a net
shortfall, chances of short term rates coming off do not seem likely.
| YIELD PROFILE |
FEDERAL INVESTMENT BONDS |
| |
THIS WEEK |
1 WK AGO |
1 YR AGO |
Overnight |
13.00 |
07.00 |
03.50 |
1 Week |
13.00 |
06.50 |
05.25 |
1 Month |
11.35 |
09.80 |
07.75 |
3 Month |
09.70 |
09.40 |
10.30 |
6 Month |
09.90 |
09.70 |
11.25 |
1 Year |
11.25 |
11.25 |
NA. |
| AUCTIONS |
| Bid Date |
Instrument |
Result |
Settlement |
| Dec
29 |
T-BILL |
Dec 30 |
Dec 30 |
| Target Amount |
Bid
Amount |
Accepted Amount |
| Rs. 01.0 Bln |
Rs.05.422 Bln |
Rs. 222.05 Mln |
| MATURITIES |
| Instrument |
Data |
Amount |
| T-Bill |
11 Jan |
3,550 Mln |
| T-Bill |
21 Jan |
3,050 Mln |
| T-Bill |
27 Jan |
450 Mln |
REPO RATES |
|
This Week |
1 Wk Ago |
1 Yr. Ago |
| Overnight |
07.00 |
12.25 |
01.00 |
| 1 Week |
06.50 |
11.00 |
03.25 |
| 1 Month |
09.80 |
11.35 |
07.50 |
| 3 Month |
09.40 |
09.65 |
10.35 |
| 6 Month |
09.70 |
09.70 |
11.75 |
| 1 Year |
11.25 |
11.00 |
N. A. |
| TREASURY
BILL RATES |
| Maturing |
This Week |
1 Wk Ago |
1 Yr Ago |
1 Month |
12.35 |
10.75 |
10.00 |
2 Month |
10.80 |
09.75 |
09.00 |
3 Month |
09.75 |
09.60 |
09.75 |
4 Month |
09.80 |
09.70 |
10.50 |
5 Month |
09.95 |
09.75 |
10.90 |
