Updated on Mar 06, 2000
For most part of the past week
overnight interbank rates remained in double digits and high single digits. Trades were
witnessed between 10.50% and 10.90%, but crashed to the other end of the spectrum on
Friday, the last day of the reporting week. Rates closed at 0.75% but not before trades
had been conducted at 6.00%, 4.00% and 2.00%. Healthy reserve averaging in addition to the
injection of Rs. 1.80 billion for one week via the two way OMO on Thursday were the
factors that contributed towards this bearish spell. But the market turned better for
lenders on Saturday as they took into effect the imminent outflows on Monday and Tuesday
next and the close was up at 9.00%.
The term market during the past week remained generally thin. Yet again
the concentration was in the one month tenor with nominal amounts trading in the band of
7.00% and 7.25%. The OMO injection did cause these levels to soften but levels rose back
on Saturday with bids and offers at 7.20% and 7.75%, respectively. Three month borrowers
continued to remain unmoved from levels of 7.10% while offers at 7.45%. Interest was
evident in five and six month tenors and trades were reported at around the 7.50% level
but amounts remained thin. Meanwhile, there was considerable demand for one year to
maturity FIBS, which has continued to increase in the wake of a declining yield curve.
Buying interest cropped up during the past week with bids for these papers being quoted in
the band of 8.75% and 9.00%.
Outflows on account of OMO injections made in February are due on the
6th and the 7th of March, coupled with the Rs. 12.60 billion maturity on the 9th of March.
An SBP intervention cannot be ruled out for early next week as rates also remained on a
firm note at close on Saturday. Key players are apprehensive about the SBP being hesitant
to commit towards an injection in 1 month and cross the quarter end. It would be
interesting to see whether the SBP attempts to inject money over the quarter end and stick
to its commitment towards keeping rates easy.
| YIELD PROFILE |
FEDERAL INVESTMENT BONDS |
1 Year |
08.75 |
08.25 |
11.75% |
2 Year |
09.25 |
08.75 |
14.00% |
3 Year |
09.75 |
09.50 |
12.50% |
4 Year |
10.00 |
09.75 |
12.75% |
5 Year |
10.50 |
10.00 |
13.25% |
10 Year |
10.75 |
10.50 |
14.00% |
| AUCTIONS |
| Bid Date |
Instrument |
Result |
Settlement |
| Feb
23 |
T-BILL |
Feb 23 |
Feb 24 |
| Target Amount |
Bid
Amount |
Accepted Amount |
| Rs. 3.5
Bln. |
Rs. 13.877
Bln. |
Rs. 2.75
Bln. |
| MATURITIES |
T-Bill |
09 Mar |
12,600 Mln |
T-Bill |
24 Mar |
4,100 Mln |
T-Bill |
25 Mar |
125 Mln |
REPO RATES |
Overnight |
08.00 |
09.75 |
00.25 |
1 Week |
07.25 |
09.00 |
01.25 |
1 Month |
07.15 |
07.25 |
04.00 |
3 Month |
07.20 |
07.35 |
07.25 |
6 Month |
07.45 |
07.55 |
10.25 |
I Year |
08.25 |
08.25 |
N. A. |
| TREASURY
BILL RATES |
1 Month |
08.25 |
08.00 |
07.00 |
2 Month |
07.75 |
07.10 |
07.75 |
3 Month |
07.60 |
07.15 |
08.75 |
4 Month |
07.55 |
07.25 |
09.75 |
| 5 Month |
07.60 |
07.35 |
10.25 |
