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FINEX WEEK

  1. The KASB review
  2. Finex week

Updated on Apr 10, 2000

Short term money market rates in the inter-bank market remained depressed with the trading range remaining mostly between 2.00% and 4.00%. A long money market from last weekend maintained a soft tone, which only rose on Friday. Trades were mostly witnessed at 1.50% and 2.00% but towards close on Friday nominal amounts traded at close to the double-digit mark of 10.00%. However this rise was only temporary and rates fell back to close at around 3.00% on Saturday. The auction settlement of Rs. 8.86 billion against a maturity of Rs. 2.50 billion could not bring about much change in the already liquid market and rates in one and two week tenors also came under pressure. The trading range for one and two week call and repo trades was witnessed between 4.00% and 5.00%.

The term repo market maintained a soft tone with the further cut in the T-Bill yields. One month had traded at levels of 5.00%, the previous week only rose marginally with trades in between 5.70% and 6.25% while three month offers were continuously available at around 6.75%. Six month offers prior to the auction were available at 6.90% and did rise to 7.25%, but the cutoff levels clearly reflected the downward pressure in the secondary market. The auction with only a pre-auction target of Rs. 2.50 billion in a fairly liquid market caused bids to open at 7.11%, 7.08% and 7.24% respectively. However after rejecting large amounts in two previous auctions SBP picked up thrice the target amount, which worked out to a total of Rs. 8.86 billion. The new cut-off being 7.11%, 7.38% and 7.73% for the three instruments.

Amounts being picked up from the coming OMO next week would be a certain possibility. Interbank five and six month levels and the secondary market bids on T-Bills are a clear indication of even a large participation at levels which the central bank could be interested in. One month levels on the other hand could pick up marginally towards as the OMO draws near.

YIELD PROFILE

FEDERAL INVESTMENT BONDS

1 Year 08.00 08.00 10.75%
2 Year 09.00 08.75 12.00%
3 Year 09.75 09.25 12.00%
4 Year 10.00 09.75 12.50%
5 Year 10.75 10.00 13.00%
10 Year 11.25 10.50 14.25%

 


AUCTIONS
Bid Date Instrument Result Settlement
Apr 05 T-BILL Apr 05 Apr 06
Target Amount Bid Amount Accepted Amount
Rs.2.5 Bln

Rs. 22.560 Bln

Rs.8.610Bln

 


 

MATURITIES
T-Bill 09 Mar 12,600 Mln
T-Bill 24 Mar 4,100 Mln
T-Bill 25 Mar 125 Mln

 


 

REPO RATES

Overnight 03.00 01.50 13.95
1 Week 04.50 03.00 13.25
1 Month 06.25 05.10 10.00
3 Month 06.70 06.40 09.25
6 Month 06.85 06.75 09.50
1 Year 07.75 07.75 N. A.

 


 

TREASURY BILL RATES
1 Month 06.75 06.50 11.50
2 Month 06.80 06.80 10.50
3 Month 06.90 06.90 10.25
4 Month 06.95 07.00 10.10
5 Month 06.95 07.10 10.00