Updated on Jun 05, 2000
The interbank market maintained
an upward trend throughout the past week with banks having to finally availing the
discount window towards the tail end of the week. Overnights did trade around 3.00% and
5.00% early in the week but spiked on Thursday on account of the settlement of the T-Bill
auction. According to unconfirmed reports a maximum of Rs. 9 billion was discounted on the
last day of the reporting week i.e. Friday. Draw downs on account of commodity financing
have also contributed towards the outflows from the system. Reports of tax collections
also being debited by the monetary authorities from the nationalized banking sector made
matters worse. Banks having borrowed one week funds earlier at 6.50% and 7.50% were lucky
as one week levels shot up to 10.50% with amounts reportedly traded at these levels. Also
nominal rupee outflows from the market on account of the sale of dollars by the SBP in the
interbank added to the liquidity crisis.
Brisk activity was reported in the term repo market in the past week.
Concentration however remained in transactions over the fiscal year end beside heavy
borrowing interest in call transactions as well. Significant spreads were witnessed
between call and repo levels with bids and offers for three, four and six month being
quoted at close to 9.50%, 9.50% and 10.00%, respectively. Early in the week borrowers in
repos extending over June 30th were witnessed picking funds around 8.00% while later some
activity was also reported at around 8.30%. The two month tenor saw activity traded
between 7.90% and 8.10% while moderate amounts were traded in three and four months
between the narrow band of 7.30% and 7.40%. The T-Bill auction saw the total acceptance of
Rs. 1.235 billion against the target of Rs. 2.64 billion. SBP maintained the cut-offs at
6.98%, 7.23% and 7.61 % for the three papers, respectively.
Further reductions in the cut-offs cannot be ruled out in the future keeping in mind
the announcements made by the Finance Minister in the past. However the current conditions
in the interbank market are definitely conducive towards this happening at least before
the end of the current fiscal year.
| YIELD PROFILE |
FEDERAL INVESTMENT BONDS |
| |
THIS WEEK |
1 WK AGO |
1 YR AGO |
| 1 Year |
08.00 |
08.00 |
09.25% |
| 2 Year |
08.75 |
08.75 |
10.00% |
| 3 Year |
09.25 |
09.25 |
12.75% |
| 4 Year |
09.50 |
09.50 |
13.00% |
| 5 Year |
10.00 |
10.00 |
13.75% |
| 10 Year |
10.75 |
10.75 |
14.25% |
| AUCTIONS |
| Bid Date |
Instrument |
Result |
Settlement |
| May
31 |
T-BILL |
May 31 |
Jun 01 |
| Target Amount |
Bid
Amount |
Accepted Amount |
| Rs. 2.640 Bln |
Rs. 4.895 Bln |
Rs.1,235 Mln |
| MATURITIES |
| Instrument |
Data |
Amount |
| T-Bill |
01 June |
50 Mln |
| T-Bill |
15 June |
1,750 Mln |
| T-Bill |
23 June |
1,045 Mln |
| T-Bill |
29 June |
100 Mln |
REPO RATES |
|
This Week |
1 Wk Ago |
1 Yr. Ago |
| Overnight |
10.95 |
06.00 |
01.00 |
| 1 Week |
10.50 |
06.75 |
01.50 |
| 1 Month |
08.20 |
07.00 |
04.50 |
| 3 Month |
07.50 |
07.20 |
07.10 |
| 6 Month |
07.50 |
07.20 |
08.25 |
| 1 Yeas |
07.65 |
07.50 |
N. A. |
| TREASURY
BILL RATES |
| Maturing |
This Week |
1 Wk Ago |
1 Yr Ago |
| 1 Month |
09.10 |
07.65 |
05.75 |
| 2 Month |
08.50 |
07.45 |
06.75 |
| 3 Month |
07.75 |
07.40 |
07.50 |
| 4 Month |
07.65 |
07.35 |
07.75 |
| 5 Month |
07.60 |
07.20 |
08.10 |
