. .



Updated on Sep 19, 2001

Conditions in the interbank money market turned around with rates moving upwards across the board. Further outflows on account of OMO and the Treasury Bill and Pakistan Investment Bonds auction also caused the market to register a shortfall towards the end of the week. On one hand, yields on T-Bills were lowered marginally, while on the other, the three and five year PIBs were sold at discount.

The overnight market initially in single digits crossed the double digit mark on Thursday as the market experienced a net outflow of approximately Rs. 2.50 billion. Overnight rates were initially at levels of 4.00% and 5.00% while one week repo activity was conducted between 7.00% and 8.00%. The market touched the 11.90% mark and registered a shortfall of Rs. 1.02 and Rs. 7.12 billion on Friday and Saturday respectively. Some banks also picked up funds for two weeks which provided them liquidity over the 30th of September, the quarter end. Two week repos on Friday and one week funds value 24th Sep. were traded as high as 11.75% and 12.00%, respectively. The T-Bill auction could not attract any major interest and against a target amount of Rs. 10.59 only Rs. 6.83 billion was received. The SBP took the opportunity in reducing the yields on the three month and twelve month papers and simultaneously rejected a single bid of Rs. 4.10 billion at the previous cut-off level for the three month paper. The cutoff for the papers stood at 10.18%, 10.51% and 10.87%, respectively. It was after this auction that SBP announced a two way OMO the very next day with bids being asked for the one week tenor, while offers were asked for the one, two and three month tenors. Rs. 4.0 billion was mopped up at 10.18% in the three month tenor while simultaneously Rs. 8.35 billion was injected for one week at 9.50%. In the PIB auction on Friday, settling on Saturday, the target amount of Rs. 8 billion was hard to get and SBP sold both the three and five papers at discount prices of 99.95 and 99.80, respectively with only Rs. 5.78 billion being sold. The term repo market which had already begun to rise prior to the change in the short term market maintained a similar trend. One month activity was reported as high as 11.00% while three month funds also changed at levels close 10.25%. Six month activity was reported at levels close to 10.55% and even 10.70%.

Rumours on any cut in the discount rate had been dispelled by the authorities earlier, and the marginal adjustment in yields on T-Bills in the auction the past week cannot be regarded as extraordinary. Furthermore with the political and military crisis still persisting in the country, we feel that keeping the rupee-dollar parity under check by firm rates and tight liquidity is what must be in the minds of the financial pundits.

Federal Investment Bond

.

THIS WEEK

1 WEEK AGO

1 YEAR AGO

1 Year

11.00

11.00

09.75%

2 Year

11.50

11.50

10.50%

3 Year

12.00

12.00

11.00%

4 Year

12.25

12.25

11.25%

5 Year

12.50

12.50

11.50%

10 Year

13.00

13.00

12.00%

 


 

AUCTIONS
BID DATE INSTRUMENT RESULT SETTLEMENT
Sep 19 T-BILL Sep 19 Sep 20
TARGET AMOUNT BID AMOUNT ACCEPTED AMOUNT
Rs.10,590 Mln 

Rs.6,830.8 Mln

Rs.1,230.8 Mln

 


 

MATURITIES

INSTRUMENT

DATE

AMOUNT

T-Bill

06 Sep

8,407 Mln

T-Bill

20 Sep

4,811 Mln

 


 

REPO RATES

 

THIS WEEK

1 WEEK AGO

1 YEAR AGO

Overnight

11.90  

01.75

01.25

1 Week

11.00  

07.00

08.25

1 Month

10.50  

09.45

08.50

3 Month

10.15 

09.70

08.50

6 Month

10.45  

09.95

09.30

1 Year

10.70  

10.55

09.75

 


 

TREASURY BILL RATES
MATURING THIS WEEK 1 WEEK AGO 1 YEAR AGO

1 Month

11.50  

10.45

09.50

2 Month

10.35  

09.80

08.70

3 Month

10.15  

09.90

09.00

4 Month

10.25  

10.00

09.10

5 Month

10.35 

10.10

09.50