Pakistan Money Market Review
Updated on Aug 07, 2000
The interbank market which had
closed long last week, witnessed rates climbing sharply with the market closing short at
the end of the reporting week, i.e. Friday. News of some unaccounted for outflows from the
market could only be blamed for such a sudden change. Short term rates at around 5.00% and
6.00% soon crossed into double digit levels with overnight trades being witnessed at
10.50% and later at 10.95%. The discounted figure at the SBP repo window initially at
approximately Rs 2.5 billion later touched the Rs. 6 billion mark on Friday. The one and
two week market which had remained in between 6.50% and 7.50% saw trades at 8.00% for one
week and two weeks at similar levels as well. The State Bank also failed to alleviate the
short market on Thursday in the regular OMO with any injection and in fact managed to
outright sell T-Bills at 7.40%.
The term repo market also took a sharp turn with one offers rising
sharply from 7.00% to as high as 8.25% later in the week. It must have the unanticipated
discounting figure that caused this panic in the one month market. However dealers in the
market realizing that this panic could be short lived place amounts at levels of 7.75% and
later on Saturday at 7.50% as well. The three and six month market, which has already been
affected due to the rise in the SBP cut-off levels, could not generate any major activity.
Nominal amounts traded for six month at close to 7.40% while three month rates generally
remained mismatched in the band of 7.25% and 7.40%. Majority of the banks participating in
the OMO having indicated borrowing interest to the tune of Rs. 7.05 billion were not
entertained by the authorities in the two week and one month tenor. However, against bids
of Rs. 1.75 billion and Rs. 1.20 billion for the three month and the outright paper, SBP
sold T-Bills to the tune of only Rs. 300 million at 7.40%.
The interbank market had been waiting anxiously for the OMO, conducted
this week, in order to gauge the kind of levels that the State Bank would be looking for.
The acceptance of such a meager amount reflects that the cut-off levels are to stay.
However, participation in the coming T-Bill auction, keeping in mind an expected
pre-auction target of approximately Rs. 15 billion, is to be at levels higher than
previous cut-offs.
|
YIELD PROFILE |
FEDERAL INVESTMENT BONDS |
| . |
THIS
WEEK |
1
WEEK AGO |
1
YEAR AGO |
| 1 Year |
08.10 |
07.75 |
09.00% |
| 2 Year |
08.35 |
08.50 |
12.00% |
| 3 Year |
08.85 |
09.00 |
12.75% |
| 4 Year |
09.00 |
09.25 |
13.00% |
| 5 Year |
09.35 |
09.50 |
13.25% |
| 10 Year |
09.50 |
10.00 |
14.00% |
| AUCTIONS |
| BID
DATE |
INSTRUMENT |
RESULT |
SETTLEMENT |
| July 26 |
T-BILL |
July
26 |
July 27 |
| TARGET AMOUNT |
BID
AMOUNT |
ACCEPTED AMOUNT |
| Rs. 10,75
Bln. |
Rs.9,145
Bln. |
Rs. 8,095
Bln. |
| MATURITIES |
INSTRUMENT |
DATE |
AMOUNT |
| T-Bill |
10 Aug |
2,350 Mln |
| T-Bill |
11 Aug |
13,309 Mln |
| T-Bill |
24 Aug |
1,600 Mln |
| T-Bill |
26 Aug |
6,360 Mln |
REPO RATES |
|
THIS WEEK |
1 WEEK AGO |
1 YEAR AGO |
| Overnight |
10.25 |
06.50 |
12.50 |
| 1 Week |
08.63 |
05.88 |
04.00 |
| 1 Month |
07.50 |
06.75 |
04.75 |
| 3 Month |
07.35 |
06.85 |
05.70 |
| 6 Month |
07.38 |
07.23 |
06.70 |
| 1 Year |
07.60 |
07.53 |
N. A. |
| TREASURY
BILL RATES |
| MATURING |
THIS WEEK |
1 WEEK AGO |
1 YEAR AGO |
| 1 Month |
08.50 |
07.35 |
06.00 |
| 2 Month |
07.65 |
07.25 |
06.10 |
| 3 Month |
07.50 |
07.20 |
06.25 |
| 4 Month |
07.50 |
07.25 |
06.50 |
| 5 Month |
07.50 |
07.30 |
06.50 |
|
