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FINEX WEEK

  1. The KASB review
  2. Finex week

Updated on Mar 13, 2000

The interbank market in the early parts of the week remained pegged at the 10.95% level with respite being sought from the SBP repo discount window. No Special SBP intervention in the past week and OMO outflows on the 6th and the 7th to the tune of approximately Rs. 12.80 billion were the reason behind the surge in rates. However, the market turned in favour of the borrowers on Thursday with trades at 7.00% before finally touching 1.50% and 2.00% on Friday and Saturday. This was attributed to the acceptance of only Rs. 76.965 million in the T-Bill auction on the 9th.

One-month levels remained firm with bids and offers at 8.50% and 9.00%, but later fell back around 7.00% on the weekend. Trades were witnessed at 8.00% and later around 7.50%. Amounts traded remained generally thin. The two and three month market also fell off from the 8.25% and 8.50% levels with amount trading at 7.75% on Thursday. No significant change in the T Bill cut-offs brought six-month repo levels under pressure, which had previously remained in the band of 7.65% and 7.75% for some time. Trades were conducted at 7.50% while later bids and offers were available at 7.20% and 7.40%, respectively. Tight secondary market conditions caused bids in the T-Bill auction to be quoted at levels higher than the previous auction. Only Rs. 76.965 million against a pre-auction target of Rs. 12 billion was picked by SBP against the one-year paper. There was no change in the cut-off yield, which stood at 7.8965% with the weighted average yield at 7.8924%.

The inter bank market could take a slight upward turn later in the next week. Outflows on account of Eid could be one reason but participation by banks in outright sale of T-Bills in the OMO could also be witnessed. An injection on the other hand cannot be ruled out if large outflows do occur but as mentioned in our last weekly it would be interesting to see whether SBP would inject money and cross the quarter end.

 

YIELD PROFILE

FEDERAL INVESTMENT BONDS

1 Year 08.50 08.75 10.50%
2 Year 09.25 09.25 12.00%
3 Year 09.50 09.75 13.25%
4 Year 09.75 10.00 13.50%
5 Year 10.75 10.50 14.00%
10 Year 11.25 10.75 14.75%

 


AUCTIONS
Bid Date Instrument Result Settlement
Mar 08 T-BILL Mar 08 Mar 09
Target Amount Bid
Amount
Accepted Amount
Rs.12.00Bln.

Rs. 8.477 Bln

Rs.76.965 Mln

 


 

MATURITIES

T-Bill

09 Mar

12,600 Mln

T-Bill

24 Mar

4,100 Mln

T-Bill

25 Mar

125 Mln

 


 

REPO RATES

Overnight 02.00 08.00 01.50
1 Week 06.00 07.25 03.75
1 Month 07.00 07.15 05.75
3 Month 07.40 07.20 07.75
6 Month 07.35 07.45 09.25
1 Year 08.10 08.25 N.A

 


 

TREASURY BILL RATES
1 Month 08.00 08.25 06.25
2 Month 07.60 07.75 07.25
3 Month 07.55 07.60 08.00
4 Month 07.60 07.55 08.75
5 Month 07.65 07.00 09.00