FINEX WEEK

 

 

By SHABBIR H. KAZMI
Updated Aug 10, 2002

 

The past week the interbank market went through a volatile phase. Lows of 0.75% and highs of 8.00% were witnessed in the overnight market while term rates shot up after the State Bank accepted a heavy amount of Rs. 28.00 billion in T-bill auction with yield being maintained. This hike in term market was temporary, later rates eased as the week progressed.

Excess liquidity in the system kept rates at 1.50% and 2.00% for overnight funds with one-week activity reported as low as 2.50%. Major activity was confined to shorter tenors, with significant interest being evident in one month and trades were reported as high as 6.25%, but later rates eased off and touched the levels of 4.75%. Rates in three and six months rose as the auction date approached and borrowing interest was seen at 5.70% and 6.00% against the offers of 5.90% and 6.25%. Later rates fall-off sharply as offers were quoted as low as 5.60% and 6.00% in the respected tenors. The auction attracted a total amount of Rs. 55.00 billion with aggressive participation for the six and one-year paper was seen. State Bank maintained the yield, as per the markets expectation with accepting only six months bids at the cut off yield of 6.43%. The total amount of Rs. 28.00 billion was picked up against the target of Rs. 16.00 billion. Banks did initially panic but with overnight, one and two weeks rates under pressure on both days after the auction it became quite evident that the market is still liquid. Due to the prevailing liquidity in the system aggressive buying interest in T-bills was noted and deals were struck at 6.00% in the latest six months paper. This week SBP has announced target of Rs. 8.00 billion for 10 year PIB which is to be auctioned on the 20th of August, trades in this when issue paper were witnessed at the premium price of around Rs 109.50.

YIELD PROFILE

FEDERAL INVESTMENT BONDS

.

THIS WEEK

1 WEEK AGO

1 YEAR AGO

1 Year

06.75

06.75

11.90%

2 Year

07.35

07.35

12.40%

3 Year

07.70

07.70

12.90%

4 Year

08.40

08.25

13.00%

5 Year

08.50

08.70

13.50%

10 Year

09.60

09.80

14.00%

 


 

AUCTIONS
BID DATE INSTRUMENT RESULT SETTLEMENT
Aug 07 T-BILL Aug 07 Aug 08
TARGET AMOUNT BID AMOUNT ACCEPTED AMOUNT
Rs.16,000 Mln   Rs.54,700 Mln.  Rs.28,800 Mln.

 


 

MATURITIES

INSTRUMENT

DATE

AMOUNT

T-Bill

08 Aug

 16,700 Mln.

T-Bill

22 Aug 

19,550 Mln.

 


 

REPO RATES

 

THIS WEEK

1 WEEK AGO

1 YEAR AGO

Overnight

05.00

08.00

12.83

1 Week

04.75

06.35

11.50

1 Month

05.25

06.05

10.50

3 Month

05.70

05.85

10.90

6 Month

05.95

06.10

11.25

1 Year

06.45

06.60

11.55



 

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

1 Month

05.60

06.40

11.50

2 Month

05.70

06.10

11.00

3 Month

05.55

05.80

10.50

4 Month

05.80

06.00

11.00

5 Month

05.95

06.10

11.05